E-COMMERCE
An Overview of Africa’s E-Commerce Industry
E-commerce involves the buying and selling of goods and services online, facilitated through websites, mobile applications, and digital platforms. In Africa, it represents one of the most dynamic and rapidly evolving sectors, fuelled by growing internet penetration, a youthful population, and increasing mobile phone adoption. Once considered a niche market, e-commerce is now playing a central role in transforming African retail, bridging geographical gaps, and opening new pathways for entrepreneurs and consumers alike. In this industry snapshot, we present an overview of the continent’s E-commerce industry.
Market Overview
Africa’s e-commerce sector has grown significantly over the past decade, supported by improved digital infrastructure and payment systems. While exact figures vary, we estimate that the continent’s e-commerce market will be worth approximately US$58 billion in revenue by 2025, with Nigeria, South Africa, Egypt, and Kenya leading in transaction volumes. Mobile commerce (m-commerce) is especially dominant, as between 50% to 60% of online purchases are made via smartphones in Africa. Platforms like Jumia and Takealot have established strong market positions, while social commerce on platforms such as Instagram, Facebook, and TikTok continues to gain traction.
The COVID-19 pandemic accelerated adoption, with more African consumers trying online shopping for the first time. The industry also proved to be resilient: The Online Retail in South Africa 2023 study, conducted by World Wide Worx and Mastercard, revealed that e-commerce in South Africa continued to grow, despite challenges posed by the country’s recovery from the pandemic affecting consumers’ spending power. However, penetration remains below 5% of total retail sales, highlighting both the growth potential and the market’s untapped nature.
Key Growth Drivers
Several factors are propelling e-commerce growth in Africa:
Digital Connectivity: Affordable smartphones and expanding 4G/5G coverage have made online shopping accessible to millions.
Demographics: Africa’s median age of 19 years creates a tech-savvy, mobile-first consumer base.
Payments Innovation: Mobile money platforms such as M-Pesa, MTN MoMo, and Flutterwave have boosted trust in digital transactions. Furthermore, digital payment methods, such as e-wallets and EFT, are gaining popularity, enabling seamless and convenient transactions for South African consumers.
Urbanisation: Rapid growth of cities creates concentrated demand for convenient shopping options.
Logistics Improvements: Emerging last-mile delivery services are making it easier for businesses to reach remote customers. Companies like Takealot are expanding their infrastructure, such as the construction of new distribution centres, to support the growing e-commerce demand and improve delivery capabilities.
Challenges & Barriers
Despite its potential, e-commerce in Africa faces several hurdles:
Logistics Infrastructure Gaps: Poor road networks and unreliable postal services increase delivery costs and times.
Digital Divide: Rural areas still have limited access to the internet and smartphones. According to the World Bank, only 28.5% of Africans in Sub-Saharan Africa have access to the internet in their homes. Furthermore, 46% of people in urban areas have access to the internet, while only 12% of people in rural areas enjoy the same privilege.
Payment Challenges: While mobile money adoption is growing, many consumers remain unbanked or wary of online payments. In our latest fintech report, we highlighted the fact that 45% of Sub-Saharan Africans don’t have access to any financial account.
Regulatory Complexity: Different countries have varying e-commerce laws, taxation policies, and customs procedures.
Trust Issues: Concerns about product quality, fraud, and customer service remain significant barriers to adoption.
Key Players & Stakeholders
Major players shaping Africa’s e-commerce landscape include Jumia, the continent’s largest multi-country platform; Takealot in South Africa; Kilimall in East Africa; and niche-focused startups like Zando (fashion) and Konga (general retail). Social media marketplaces and informal sellers on WhatsApp and Facebook also account for a significant share of transactions. Government bodies, such as the African Union and national ICT ministries, alongside organisations like the International Trade Centre, are actively promoting digital trade initiatives.
Emerging Trends & Opportunities
Several emerging trends present opportunities for entrepreneurs and investors:
Social Commerce: Leveraging social media platforms to sell directly to consumers is reducing customer acquisition costs.
Cross-border E-commerce: The African Continental Free Trade Area (AfCFTA) opens new opportunities for regional online trade. Furthermore, Africa and the Middle East are among the largest online import markets globally, presenting significant growth potential for African online sellers.
Niche Marketplaces: Platforms focusing on local crafts, fashion, or agriculture are finding loyal customer bases.
Buy Now, Pay Later (BNPL): Flexible payment solutions are boosting affordability and purchase frequency.
Integration with Offline Retail: Hybrid models, such as click-and-collect, are bridging the trust gap by combining online selection with physical pickup points.
Industry Outlook
The future of e-commerce in Africa looks promising, with sustained growth expected over the next decade. As infrastructure improves, regulations become more harmonised, and consumer trust strengthens, online shopping is set to move from the fringes to the mainstream of African retail.
According to Mordor Intelligence, the South African e-commerce market is expected to grow at a CAGR of 12.5%, driven by the rise in smartphone usage, internet access, and digital payment systems.
The Middle East and Africa Region is also expected to experience rapid growth, growing with a CAGR of 14.28% from 2025 to 2030.
Businesses that can adapt to local needs, build trust, and leverage mobile-first strategies will be well-positioned to succeed in this fast-evolving sector.
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