Many of us can remember ordering a product online and receiving one of an inferior quality -- different in texture or shape from the one displayed on the website. This may happen quite often and has led to a breach of trust between online buyers and online retailers.

A major benefit of online shopping is the ease with which one can buy a product. But it is stressful if the product is faulty and one has to return it.

There are several online businesses that have been doing very well. There are others not doing very well. The lack of policy and monitoring mechanism to oversee their working is the reason behind their large numbers. Sometimes, online business websites do not even mention contact numbers.

This has raised questions about how to increase consumers’ confidence in online businesses and make those involved in unhealthy business practices accountable. This is important both in terms of consumer protection and sustainability of online business transactions.

The fact that only a small fraction of these transactions are carried out through online banking systems and the remaining under cash-on-delivery (COD) mode makes it difficult for the policymakers to document the e-commerce market in Pakistan. This is also why a large number of them remain unidentified and untraced.

What is the way forward and what needs to be done to exploit the full potential of e-commerce in Pakistan? Leading online businesses like Daraz, Yayvo, Goto, etc, are earning good revenues but there are many others that are not.

Saqib Azhar, CEO of Enablers, a Pakistani company that enables local businesses to sell their products on Amazon, says there is no single mechanism to monitor online shopping stores in Pakistan, "however, consumers check the trustworthiness of e-commerce websites by looking at the online reviews of other people. They also check for the SSL certificate, return policies and analyse the content on the website."

Azhar says when it comes to customer satisfaction, the product return policy may vary from seller to seller. "So, the best practice is to check the return policy of the seller before placing an order."

He cites the example of Amazon and its best practices that have helped it become world’s biggest e-commerce company. "Usually Amazon holds product return policy within 30 days of receipt of delivery by using its online return centre. Once the item is returned, it might take 25 days to reach fulfillment centre. After that two days are required to refund and in three to five days the refund amount will show up in the customer’s account. Amazon also refunds postage costs once the product is received.

On the contrary, he says, "Online stores in Pakistan usually advertise a 7-day return policy. Some online platforms do not have a return policy, only exchanging of the product is possible while some refund your amount. Also, the delivery and shipping charges are not refundable."

Apart from faulty or no return policies, a few of the main complaints of online customers in Pakistan are delayed shipments, a product different from what was ordered, receiving a defective item, used item being sold as new and the delivered product not matching with the description.

Khalid Mahmood, a regular online customer, has had different experiences with different online stores. "Sometimes one has to argue with delivery people because they demand payment before handing over the product. The delivery guy refuses to return the money posing to be representative of a courier company and not the seller."

He hopes things will get better soon as Alibaba has acquired Daraz and will be setting new standards. Another good news, he says, is that the government has completed the draft of Pakistan’s first-ever e-commerce policy and would be approving it soon.

In recent years, e-commerce market of Pakistan has experienced exponential growth. Nevertheless, there is still room for more growth. Proper management of e-commerce operations, product management, inventory, pricing, order fulfillment and last-mile delivery is crucial for the growth of e-commerce businesses here.

The online stores need to emphasise more on the social media management and digital marketing to support the platform. They also need to introduce new features that can help grow sales. There is high competition among online stores and being creative is the key to stand out.

Akeel Khalid, founder and CEO of Vceela.com, an online shopping platform, says one complaint forum in Pakistan is the consumer courts where customers can take their complaints in case of a bad experience. The procedure is not ideal and a lot of work needs to be done. He mentions that a consumer court has recently imposed a Rs50,000 penalty on Careem on a consumer’s complaint.

"We, at vceela.com, have an easy and hassle-free return policy. In case a customer gets a wrong or damaged product, we return the product immediately and have a policy of transferring customer’s money back to their accounts within two days."

Khalid believes e-commerce has not yet reached anywhere close to its potential in Pakistan. There are still huge gaps in logistics, payment options and consumer confidence, hampering the growth of e-commerce in Pakistan. He says, they also receive orders from all over the world and have delivered their products to more than 43 countries but the logistics and payment options available currently have hampered their potential to reach foreign markets in Business to Customer (B2C) model. "Once these issues are resolved, e-commerce can be a huge factor in improving the exports from Pakistan by a significant number," he adds.

Azhar, the Enablers CEO, points out that the Federal Board of Revenue (FBR) has announced a six percent sales tax on online sales as an incentive. "It is reduced from 17 per cent which shows that it’s high time people considered investing in e-commerce businesses more than brick and mortar," he adds.

A mention of salient features of the upcoming e-commerce policy seems pertinent here. The government has realised that there are bottlenecks and has declared intentions to address these. For example, it will promote financial inclusion and digitisation, COD mode of e-commerce will be gradually discouraged through special incentives for consumers and merchants with an objective to use digital devices for payments. (Within three years of the launch of this policy maximum COD transaction amount will be raised to Rs 5,000. Within 10 years all COD will be transferred to e-payment.

The Ministry of Commerce and Textile (MoC&T) and the ministry of IT and Technology (MoIT&T), in collaboration with the private sector, shall establish a certification mechanism.

The State Bank of Pakistan will shortly issue guidelines for improving the banking services for merchant accounts to make it attractive for retailers and service providers, etc, both online and offline.

Besides Visa, Master, One Link and Payoneer payment gateway facilities, the SBP will further facilitate access to international payment gateway, shall work on allowing an existing international service provider to offer services in Pakistan.

It is also suggested in the policy draft that for raising awareness about consumer rights, "it shall be mandatory for online marketplaces to display flash messages related to consumer protection provisions on their websites. Consumer Protection Councils shall hold seminars for public awareness and also provide trainings to the adjudicating officers of consumer courts."

There is a proposal also to establish consumer courts in all districts with a special provision to tackle complaints related to e-commerce.