On Double Eleven, Taobao officially opened Cambodia Direct Delivery Service, this initiative for the development of Cambodia's e-commerce industry has a landmark significance, the Chinese e-commerce giant's international expansion not only connects the Cambodian consumers and the global commodity market, but also for the Cambodian e-commerce industry upgrading to bring important opportunities.
This historic opportunity will drive the overall upgrading of Cambodia's e-commerce industry and will also help diversify and internationalise the Cambodian economy.
The COVID-19 pandemic has boosted the rapid rise of Cambodia’s e-commerce industry
Before the COVID-19 pandemic, Cambodia's e-commerce industry was still in its infancy compared with its neighboring countries. In 2020, Cambodia's e-commerce penetration rate accounted for only about 1%-2% of the overall retail market. Large shopping malls and traditional markets are important places for consumers to shop daily. Consumption patterns are still stuck in offline shopping, and cash transactions dominate.
While some merchants and consumers have begun to accept e-commerce platforms for shopping and digital payments during the same period, most merchants and consumers choose to transact on social media platforms such as Facebook and Telegram, and social media shopping is also often dominated by cash-on-delivery due to the lack of a mature payment and logistics system.
During the COVID-19 pandemic, Cambodia's e-commerce industry experienced explosive growth, driven by surging consumer demand, technological infrastructure, payment tools, and logistics services. This transformation disrupted the country's traditional social media e-commerce landscape, giving rise to a diversified ecosystem where local platforms, international giants, and social commerce coexist.
Platforms like Nham24, FoodPanda, WOWNOW, E-Gets, and GOODTOGO-FoodDelivery rapidly emerged during this period, gradually integrating with e-commerce platforms. An increasing number of local businesses and small to medium-sized enterprises began setting up shops on delivery platforms or e-commerce platforms such as Khmer24, Smile Shop, L192/Little Fashion, La Rue, and Tinh Tinh Online Shop. Meanwhile, international e-commerce giants like Shopee and Lazada also entered the Cambodian market.
Cashless payment methods have become widespread, with e-wallets and digital payment tools like ABA, Wing, Pi Pay, and Alipay emerging as the primary payment options.
In particular, ABA Bank, which seized a leading position in the digital transformation process, experienced rapid growth during the pandemic. By the end of 2023, ABA Bank had established 95 branches in Cambodia, deployed 45 automated ATMs offering 24-hour services, and served a customer base of 3.1 million, including individuals, SMEs, and large enterprises.
As the pandemic subsides and Cambodia's e-commerce industry continues its rapid expansion, the sector demonstrates immense potential for future growth.
The Cambodia's e-commerce market holds vast prospects and limitless potential
Data shows that Cambodia's e-commerce market reached a size of $1.11 billion in 2022. According to Statista, the market is expected to achieve a compound annual growth rate (CAGR) of 13.51% between 2023 and 2027, potentially reaching $2.1 billion by 2027.
Furthermore, a report by the Telecommunications Regulator of Cambodia (TRC) indicates that as of June 2024, the number of registered mobile broadband and internet users in Cambodia exceeded 20 million.
According to a report released by the National Bank of Cambodia, the volume of mobile payment transactions in 2023 reached 601.3 million, with a total transaction value of $75.8 billion—equivalent to 2.4 times Cambodia's GDP.
These figures highlight Cambodia's significant digital transformation, demonstrating how the country's economic growth and digitalization are creating vast opportunities for the e-commerce industry.
The robust growth prospects of Cambodia's e-commerce sector are not only driven by rapidly increasing market demand but also closely tied to government policies and guidance. Under the leadership of the "Pentagon Strategy," Cambodia has accelerated its digital transformation, promoted widespread adoption of e-wallets and digital payments, and optimized its logistics network, effectively fueling the thriving development of its e-commerce industry.
Multiple favorable factors are driving the vigorous growth of Cambodia's e-commerce economy
I. Accelerated Digital Transformation Under the "Pentagon Strategy"
Under the "Pentagon Strategy," the Cambodian government has identified digitalization as a key factor in enhancing national competitiveness. As a crucial component of digital transformation, e-commerce plays a vital role in driving economic growth, fostering innovation, and promoting internationalization.
To expedite the digital transformation process, the Cambodian government has implemented the Digital Economy and Society Policy Framework (2021–2035), emphasizing investments in digital infrastructure such as internet connectivity, telecommunications, and data centers. The government has also actively promoted digital skills training and encouraged the application of information technology across various sectors.
Additionally, the introduction and enforcement of the E-Commerce Law have provided a legal framework to protect the e-commerce industry, ensuring its healthy and orderly development. This has significantly enhanced consumer trust and participation, creating a supportive environment for the growth of e-commerce and laying a solid foundation for Cambodia's digital economy to thrive.
Ⅱ. The Widespread Adoption of E-Wallets and Digital Payments
With the rapid development of the digital economy, the Cambodian government and financial institutions have increased their support for E-Wallets and digital payment tools, gradually implementing cross-border payment functionality to facilitate e-commerce transactions between Cambodia and other countries.
According to data from the National Bank of Cambodia, as of 2023, there were 33 payment service institutions (PSIs) and 2 banking financial institutions (BFIs) authorized to operate payment services, with e-wallet account registrations reaching 19.7 million users.
On October 14, 2024, the National Bank of Cambodia officially launched a cross-border QR code payment service in collaboration with Bakong payment and Alipay+. International tourists from 9 countries and regions using Alipay+, as well as visitors from countries such as Thailand, Vietnam, Laos, South Korea, and Malaysia, can make seamless payments with Bakong at over 3 million merchants in Cambodia.
The growing popularity of Bakong, Pi Pay, Wing, ABA, Alipay, and other E-Wallets and payment tools is providing strong support for Cambodia's e-commerce sector and cross-border e-commerce.
Ⅲ. Upgrading and Expanding the Logistics and Distribution Network
Currently, the logistics methods used in Cambodia's e-commerce include Virakbuntham, J&T Express, Private Taxi, Capitol, Zhongtong, Kerry, L192Power G, Loda, CE, and others, covering various transportation modes such as sea, land, and air freight.
In recent years, the Cambodian government has been continuously increasing its investment in infrastructure construction, including roads, bridges, ports, airports, and canals. The government has been building highways connecting Phnom Penh to provinces, bridges across the Mekong River and other major waterways, expanding Phnom Penh Port and Sihanoukville Port, upgrading Phnom Penh International Airport and other airports, and constructing the Funan Techo Canal to connect western Cambodia with ports in other Southeast Asian countries.
As these infrastructure projects are gradually completed, Cambodia’s logistics and distribution network will rapidly upgrade and expand. Warehousing facilities and supply chains will be continuously optimized, significantly improving logistics and trade efficiency, and providing broader development opportunities for the e-commerce industry.
Ⅳ. Advancements in Technical Support and Data Analysis Applications
Global leading cloud service providers, such as Alibaba Cloud and AWS, have entered Cambodia, bringing efficient and secure data storage and computing capabilities to the country.
More businesses are actively adopting advanced technologies such as cloud computing, big data analytics, intelligent logistics, and automated warehousing, which effectively reduce costs and improve operational efficiency.
The integration of technical support and data analysis fosters mutual growth, providing scientific evidence to help Cambodia's e-commerce sector and supporting industries devise strategies and expand their markets. These advancements drive innovation, enhance the overall competitiveness of Cambodia’s e-commerce industry and its supporting sectors, and steadily propel the economy into a new phase of intelligent and refined operations. This will deeply integrate Cambodia into the global digital economy wave.
The rapid development of Cambodia’s e-commerce industry not only showcases its potential in Southeast Asia but also brings new business opportunities for industry players.
Looking at the broader picture of Cambodia’s e-commerce industry development—whether through expansive market expansion, cutting-edge technological applications, favorable policy environments, or the ever-evolving consumer upgrade wave—the enormous potential and diverse opportunities are striking.
For businesses, to stand out in this opportunity-filled market, they must have keen market insight, a deep understanding of consumer needs, the ability to swiftly seize market and technological transformation opportunities, and the flexibility to adjust business strategies while leveraging policy advantages. This will allow them to carve out a place in this emerging market with immense potential.
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