If you are thinking of starting an e-commerce business in Mauritius, you are about to embark on a thrilling journey. An adventure filled with opportunity, innovation, and exciting challenges. This tiny island nation has a rapidly growing digital economy, and there’s never been a better time to dip your toes into its e-commerce waters.
The Rise of E-commerce in Mauritius
Over the past few years, e-commerce has steadily risen globally, and Mauritius has not been left behind. The Mauritian e-commerce sector is burgeoning with potential, with more and more consumers turning to online shopping as a convenient and safe alternative to traditional retail. Despite its small size, Mauritius has a high internet penetration rate and a digitally savvy population, making it an ideal location for starting an e-commerce business.
The transaction value in the digital commerce market is projected to reach US$297.80 million in 2023. The annual growth rate (CAGR 2023-2027) is expected to be 16.24%, resulting in a projected total amount of US$543.60 million by 2027. The number of users in the digital commerce market is expected to amount to 0.53 million users by 20271.
E-commerce’s popularity in Mauritius has increased as a result of the COVID-19 outbreak, which caused a nearly two-month confinement in 2020 and 2021. Total digital revenues in 2020 accounted for $135.1 million, with e-commerce generating the highest digital revenues at $103 million, a share of 76.4%. The eServices market generated revenues of $4.7 million, while the eTravel and digital media markets generated revenues of $10 million and $17.2 million, respectively2.
Despite a relatively high internet penetration rate of 62% in 2020, the speed and bandwidth required for modern e-commerce transactions were lacking in some remote areas. To address this limitation, the country has upgraded to fiber-broadband with speeds between 10MB and 30MB2.
The Mauritian e-commerce market’s largest segment in 2020 was fashion, with a market volume of $48.6 million, followed by electronics and media ($27.4 million), food and personal care ($14.3 million), furniture and appliances ($7.3 million), and toys, hobby and DIY ($5.5 million). The 2021 Mauritius Statista report forecasts that e-commerce revenues will have a positive annual average growth of 16.5% by 2025, and that total FinTech transaction value will grow by 24.2% by 20252.
While cash payments remain the norm, payment by debit/credit card is popular, gradually replacing cash payment in malls, supermarkets, and restaurants. Internet banking and mobile banking applications are also increasingly used by consumers. The value of internet banking transactions increased from Rs 678 million (approximately $15.4 million) to Rs 695 million (approximately $15.8 million) between March 2021 and March 2022. Mobile banking transactions increased 62% between March 2021 and March 20222.
Legal Requirements for Starting an E-commerce Business in Mauritius
Starting an e-commerce business in Mauritius involves several legal requirements:
Business Registration: You would need to register your business with the Registrar of Companies. The process includes submitting a business name, providing detailed information about business owners and shareholders, and paying a registration fee.
Trade License: Depending on the nature of the business, a trade license may be required. This can be obtained from the Municipal City Council or District Council in your area of operation.
Value Added Tax (VAT) Registration: If your annual turnover exceeds MUR 6 million, you would need to register for VAT with the Mauritius Revenue Authority (MRA).
Data Protection Act: Businesses must comply with the 2017 Data Protection Act, which mandates appropriate protection for customer data.
Electronic Transactions Act: The 2000 Electronic Transactions Act provides for the recognition of electronic signatures, which is relevant for e-commerce transactions.
Cyber Crime and Computer Misuse Act: This 2003 Act provides regulations for cyber activities, which e-commerce businesses should be aware of and comply with1.
As for the state of e-commerce in Mauritius, the transaction value in the Digital Commerce market is projected to reach US$297.80 million in 2023 and is expected to show an annual growth rate of 16.24% resulting in a projected total amount of US$543.60 million by 2027. The number of users in the Digital Commerce market is expected to amount to 0.53 million users by 2027. The average transaction value per user in the Digital Commerce market is expected to amount to US$0.73k in 20232.
E-commerce is increasingly popular in Mauritius, particularly in the wake of the COVID-19 pandemic. Internet penetration stood at 62% in 2020. There are some challenges with the speed and bandwidth required for modern e-commerce transactions in more remote areas, but the country has upgraded to fiber-broadband with speeds between 10MB and 30MB to address this limitation. Several companies have invested in e-commerce platforms for services such as tourism deals and household services1.
Banking in Mauritius is sophisticated and digital transactions are growing in popularity. Debit/credit card payments are gradually replacing cash in malls, supermarkets, and restaurants. Internet banking and mobile banking applications are also increasingly used by consumers. Major banks in Mauritius have been investing heavily in mobile banking since 2011, and the value of internet banking transactions increased between March 2021 and March 20221.
The largest e-commerce market segment in 2020 was fashion, with a market volume of $48.6 million, followed by electronics and media ($27.4 million), food and personal care ($14.3 million), furniture and appliances ($7.3 million), and toys, hobby, and DIY ($5.5 million). The 2021 Mauritius Statista report forecasts that e-commerce revenues will have a positive annual average growth of 16.5 percent by 20251.
The Digital Oasis in the Indian Ocean
The future is clicking into place for the island nation of Mauritius. Known for its stunning beaches, vibrant culture, and exotic wildlife, the country is now carving out its niche in a new sector: e-commerce. While Mauritius may not be the first place you think of in the digital marketplace, this could change in the coming years.
Consider the country’s trajectory: adopting digital commerce has been steady and promising, fueled by a series of tech-friendly policies and burgeoning infrastructure. With the government’s proactive approach towards the digital economy and a resilient private sector, the island is poised to become a standout player in the global e-commerce landscape.
Tackling the Digital Divide
Rural areas have long struggled with internet connectivity, a fact that has hindered the growth of e-commerce. In a strategic move, Mauritius has upgraded to fiber-broadband with speeds between 10MB to 100 MB, making it possible for even the most remote parts of the country to participate in the digital economy. This has the potential to revolutionise rural economies, providing residents with access to global markets and a wider array of goods and services.
A Flourishing Digital Marketplace
In recent years, Mauritius has seen a rise in e-commerce platforms catering to various needs. These platforms are reshaping the consumer landscape, from finding tourism deals to hiring home services. It’s not just the international giants making a splash – local players are also getting in on the action, offering unique services tailored to the Mauritian market.
The Fashion of the Future
Fashion is leading the charge in the e-commerce market in Mauritius. As digital platforms evolve and offer more personalised shopping experiences, we expect to see an uptick in online fashion sales. The convenience, variety, and speed of online shopping, coupled with the increasing popularity of global fashion trends among Mauritian consumers, suggest that this sector will continue to flourish.
Banking on the Go
Mobile and internet banking have seen impressive growth in Mauritius, with consumers increasingly moving away from cash transactions. Major banks in the country have been investing heavily in mobile banking, leading to a significant increase in mobile banking transactions. This digital shift in banking is enabling seamless online transactions, creating a conducive environment for the growth of e-commerce.
The Future Is Here – Start your e-commerce business in Mauritius today!
Looking ahead, Mauritius’ digital commerce market is set for a boom. The combination of tech-savvy consumers, improved internet infrastructure, and a supportive regulatory environment are all creating a perfect storm for the rise of e-commerce.
The COVID-19 pandemic has demonstrated the value and necessity of digital commerce, and Mauritius has risen to the occasion. The country is now at an inflection point, with the potential to transition from an emerging market to a leading player in the digital economy.
The story of Mauritius is more than just an economic transformation. It’s a testament to how a small island nation is leveraging technology to shape its future and in doing so, is setting an example for other countries to follow. The future of e-commerce in Mauritius is bright, and the world will watch as this digital oasis continues to evolve.