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Sri Lanka's internet market grows

Lamudi Sri Lanka examines the capacity of the nation's start-up culture.

A growing number of internet start-ups has been investing in Sri Lanka over the past couple of years. These start-ups focus on several categories such as online real estate advertising, food reviews, delivery and travel and tourism. Does this mean that Sri Lanka has a positive outlook for digital businesses?

According to statistics obtained from Statistia, an online statistics platform, almost a quarter of the nation's population of nearly 21 million have access to internet. The growth was distinguished after the civil war ended in 2009, before which internet penetration was less than five percent. Today, the growth rate has been recorded at nine percent.

Within the past five years, internet use has developed quite rapidly. Simultaneously, the use of Facebook and other social media sites has risen as well. As specified by Readme.lk, nearly 2.3 million Sri Lankans had active Facebook accounts with 33 percent of them being between the age group of 25 and 34, as of Q4 2014.

The younger generation, aged between 25 and 34, tech savvy and exposed to trade over the internet will create a cash-free environment in the future. As of mid-2014, it was identified that 950,000 Sri Lankans had purchased credit cards to buy goods online or for use at points of sale (POS).

The Sri Lankan internet market is growing significantly where people are becoming more comfortable with purchasing goods online using credit cards, debit cards and cash on delivery, because it is convenient. In the search for information of any sort, be it statistics, market reports or international updates, the internet is relied upon heavily.

Internet and social media will be the key players in the future. Retailers who were mainly focused on selling offline have achieved more sales via the use of online platforms. A renowned real estate agency, Property Line, said that it rented out properties to over 50 customers of which most were expats, through Lamudi Sri Lanka, an online real estate platform.

Recent research by MasterCard has found that Colombo is the world's fastest growing city. Internet plays a major role in the city attaining this position because investors, tourists and expats explore the nation and its future potential using the internet. Major international and domestic luxury real estate developers maximise sales using online means to achieve international exposure, thereby, attaining a strong inflow of currency into the country.

Managing Director, Lamudi Sri Lanka, Hugh van der Kolff said, "Sri Lanka has moved to the digital world only now, while many other nations changed years ago. As an emerging nation, the country has room for several internet start-ups to satisfy the needs of the modern buyer without hassle."

"With developed markets reaching saturation or lack of room for new entrants, Internet businesses are looking for emerging nations to invest in. Hence, Sri Lanka is definitely a blue ocean for internet start-up companies," he said.

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