Forging Her Own Path: Women and Informal Online Commerce

Forty-six-year-old Naing Naing set up a catering business in her hometown in Myanmar at the urging of her son. Building on initial success of orders placed by phone and Viber, Naing Naing turned to Facebook with the help of her family. Soon after, orders placed in Facebook comments and via Facebook messenger jumped from 25 to 85 per month.

Pineapple sellers in Yangon, Myanmar
Pineapple sellers in Yangon, Myanmar. Across Myanmar and other countries, a growing number of women are using social media alongside financial services like mobile money to discover and transact with customers online. Photo: Aleithia Low, 2016 CGAP Photo Contest

Since she started her business, Naing Naing’s family has more confidence, admiration and trust in her. While her husband and son worry about the stress of running a business, Naing Naing is determined. Recently, when her husband fell too ill to work, she was proud that the household could live modestly on her earnings. She feels more secure and stable than ever, knowing that if something were to happen to her husband, she would be able to make her own way.

However, Naing Naing still has a long way to go in her business development. She currently hires neighbors and friends to help her if she receives a large order. She doesn’t feel capable of managing finances, especially other people’s money, and feels insecure about demanding higher prices. Naing Naing now wants to take out a loan to expand her businesses into a restaurant, but she needs support in registering her business first and applying for the bank loan.

Naing Naing is one of many other women interviewed in Bangladesh, Myanmar and Pakistan who are increasingly opting for an unregulated form of commerce over social media platforms to transform their livelihoods — a practice CGAP refers to as informal online commerce (IOC). Over the past three years, CGAP and partners in Asia explored this growing phenomenon to understand IOC better and the women who engage in it.

Why informal online commerce and not e-commerce?

E-commerce platforms offer streamlined, end-to-end solutions that enable sellers to transact with customers at scale. Meanwhile, IOC is essentially peer-to-peer and offers small-scale buyers and sellers greater flexibility to customize transactions to meet their needs. It is essentially human-centered, while e-commerce offers standardized solutions that are built for scale. For this reason, IOC operates in a space that formal e-commerce does not reach.

Comparing informal online commerce with e-commerce

Comparison of e-commerce and IOC based on different stages of sales process - discovery, price determination, payment determination, delivery mechanism, customer service
Source: "Business Her Own Way: Creating Livelihoods Through Informal Online Commerce" (CGAP 2021)

IOC embodies certain characteristics that make it appealing and further distinguish it from e-commerce. As with informal work, IOC does not require a business license, and it requires little upfront investment. IOC sellers can get started with little more than a data-enabled phone. Sellers need not invest in stock since they can on-sell from other IOC sellers within their network, in a model akin to drop shipping. And because IOC offers flexibility in payment methods, sellers and their customers can use whatever methods are available to meet their respective needs.

All these benefits are very appealing to women, particularly in contexts where social norms dictate that the husband should be the primary breadwinner and women are unlikely to get community or institutional support to start a formal business or to attract investment. IOC can bridge this gap.

Why is it important to take a closer look at IOC?

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It is often created by women. IOC has been discovered by women in different contexts, totally independently in a bottom-up fashion. They have created IOC by cobbling together various platforms and resources to enable them to conduct online commerce in a way that works for them. In many ways, IOC fills the gaps where formal e-commerce comes up short.

It is largely dominated by women (and not just wealthy women). While exploring this growing global phenomenon, CGAP found that women are vastly over-represented in IOC, with men tending to prefer formal e-commerce platforms. And it’s not just the wealthy; women of all social classes were found to be taking part in IOC.

It can be an important part of a woman’s livelihood strategy. Women engaged in IOC, like Naing Naing, have shared stories of newfound financial gain and independence. IOC gives women the opportunity to reap financial benefits from starting a business or expanding an existing client base.

It creates a needs-based relationship with financial services. Enticingly, IOC provides a reason for women to engage with financial services where previously there wasn’t one. Women reported that IOC introduced them to new financial services, such as mobile money, and that they deepened their use of these services as their businesses flourished, finally branching out into new services like credit as their IOC activities demanded.

It cultivates resilience. IOC’s flexibility and customizability makes it particularly well suited to women who are poor or financially excluded, often in the face of systemic and normative constraints. Its low barrier to entry also allows new sellers, some of whom had lost their jobs due to the pandemic-induced lockdowns, to start up delivery-based businesses and for existing businesses to make the shift.

Taking this forward: How can funders help women in IOC?

CGAP’s newly published focus note “Business Her Own Way: Creating Livelihoods Through Informal Online Commerce” outlines the characteristics of IOC, maps the personas of the women who engage in it, and provides guidance on what key role funders can play in supporting women in IOC. By further validating and expanding upon these findings, funders can determine what kinds of support programs to fund across various contexts.  



This Focus Note outlines the characteristics of IOC, maps the personas of the women who engage in it, and provides guidance to funders looking to support women to generate livelihoods through IOC.

Millions of women are buying and selling goods online across Asia — but, at least in Bangladesh, Myanmar and Pakistan, they’re not transacting on e-commerce platforms. They’re using social platforms instead, often without digital payments.

Closing the financial inclusion gender gap is about more than account access. It’s about making sure accounts unlock real opportunities for women. In Bangladesh, linking mobile money to informal e-commerce could meaningfully advance women’s financial inclusion.

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