India ranks 83rd on UN index assessing e-commerce readiness

India scores 40.6 on index value with 1.8% individuals over 15 years owning a credit card (2011 data), 12.6% using the internet (2013 data), 48.2 secure servers per million people

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India has been ranked a lowly 83rd on a new index compiled by the UN trade body, United Nations Conference on Trade and Development (UNCTAD) for assessing the readiness of countries, for electronic commerce and it has the fourth largest number of complaints made against companies selling online.

UNCTAD's new business-to-consumer (B2C) e-commerce index, which surveyed 130 economies, covers countries on four indicators — internet usage, secure servers, credit card penetration and postal delivery services.

The index value is strongly correlated to the variation in the share of individuals shopping online.

India scores 40.6 on index value with 1.8 per cent individuals over 15 years owning a credit card (2011 data), 12.6 per cent using the internet (2013 data), 48.2 secure servers per million people and 100 per cent population having mail delivered at home.

“India is quite far down because of low levels of credit card usage. Also, at the national level you still have relatively low internet usage. But one of the strong points is that you have mail delivered at home. Far from all (countries) have 100 per cent (mails delivered at home) like in India,” said Torbjorn Fredriksson, chief of the information and communications technology analysis at UNCTAD.

“It's (e-commerce) taking off in India and you have some companies like Flipkart that are getting through but at an aggregate level, India is still a small player though the potential is very big in India,” Fredriksson said.

Though globally, credit cards still account for the biggest share of e-commerce settlements according to WorldPay 2014, for India cash-on-delivery is used for more than half — 50 to 80 per cent — of all online transactions.

After the US, China and the UK, India has the fourth largest number of complaints made against companies selling online, however, the reported incidents in the US in 2013 was 48.7 per cent while in India was much smaller and stood at 2.3 per cent.

Globally, the top four countries with highest readiness for electronic commerce are Luxembourg, followed by Norway, Finland and Canada.

Though China is 63rd in the UNCTAD-formulated index, it is already the world's largest B2C market measured both by the revenue and the number of online buyers.

The Alibaba Group is the world's largest e-commerce company by gross merchandise value — volume of goods and services being transacted — followed by Amazon and eBay.