E-commerce sector needs a major overhaul
Why couldn’t the authorities protect customers from Evaly and RingID?
The question is: Where has all the money gone? ILLUSTRATION: Collected
Following in the disgraced footsteps of Evaly, social network platform RingID has also recently come into the limelight after one of its directors was arrested.
According to Evaly's own data obtained by The Daily Star, the controversial e-commerce platform owes at least Tk 408 crore to 1,026 sellers. This amount is nearly double of what Evaly claimed to be the case to the commerce ministry on September 5. The actual amount could be even higher as there may be more data outside of what this newspaper obtained. Out of the 1,026 merchants, most are owed between Tk 5 lakh and Tk 30 lakh each. Around 70 sellers are owed over Tk 1 crore, and over 10 sellers north of Tk 5 crore each.
There are more than 500 small traders—each owed Tk 10 lakh or less—who are still waiting to be paid. Many of them are now stuck in a limbo, as the amount they are owed is quite substantial for a business of their size, and could be the difference between them continuing their operations and going out of business. According to Rab, Evaly had only Tk 30 lakh in its bank accounts, which is nowhere near enough to repay the vast majority of its merchants. The question is: Where has all the money gone? Experts have already called on the authorities to investigate the money laundering aspect of it. If the money is not in the banks, chances are that it has been laundered abroad.
Following in the disgraced footsteps of Evaly, social network platform RingID has also recently come into the limelight after one of its directors was arrested. According to our report published on Sunday, RingID had been running a type of pyramid scheme that promised to reward members for drawing in more clients. It was also conducting transactions through e-wallets in the name of selling various products at unusual discounts, even though the company did not have the authorisation to collect such deposits. Nevertheless, between May and July, RingID collected a total of Tk 212.3 crore by selling memberships.
These two cases and others that have come to light recently have exposed the stark weaknesses of the country's various regulatory bodies that allowed these companies to operate and defraud people for too long. One may recall that it was in August 2020 when the media first reported that the Bangladesh Bank would investigate Evaly's financial transactions. At that time, Evaly had told the commerce ministry that it owed its customers Tk 311 crore, and that it had 207,741 customers. Why was the company still allowed to continue with its fraudulent operations? Why is it taking the various government bodies so long to complete their investigations? Is it due to a lack of coordination? What about the merchants and customers, who have fallen victim to Evaly's tricks? Who will pay for their losses?
While the authorities should take every step necessary to recover the money lost by clients and customers of both Evaly and RingID, they also need to take a good hard look at their own failures which allowed these companies to defraud people. Additionally, there has to be better regulatory supervision of the e-commerce sector, which doesn't deserve to get mischaracterised because of a few bad apples.
For all latest news, follow The Daily Star's Google News channel.
Comments