Learning Objectives

By the end of this chapter, you will be able to:

  • Define e-commerce and m-commerce and classify e-commerce models.
  • Describe the role and types of electronic payment systems.
  • Define e-governance, its models, and its goals.
  • Discuss the advantages and challenges of these applications in Nepal.

Major Applications of the Internet

The internet has enabled a wide range of new services and business models that have transformed society.

E-Commerce and M-Commerce

  • E-Commerce (Electronic Commerce): The buying and selling of goods and services over the internet. This includes everything from online retail (Amazon) to digital services (Netflix).

  • M-Commerce (Mobile Commerce): A subset of e-commerce that is conducted entirely on mobile devices like smartphones and tablets. This has seen explosive growth with the rise of mobile apps.

E-commerce models

Model Meaning Example
B2C Business sells to consumers Daraz, an online clothing store
B2B Business sells to business A distributor taking online orders from retailers
C2C Consumer sells to consumer Hamrobazar classifieds
C2B Consumer sells to business A freelancer selling services or stock photos
G2C Government serves citizens Online tax payment, passport application

Features of m-commerce

  • Anytime, anywhere access through smartphones.
  • Location awareness — apps use GPS to show nearby restaurants or drivers.
  • Personalization — notifications and offers based on user behavior.
  • Instant payment through wallets and QR codes.

Food delivery, ride-hailing, mobile banking, and mobile top-up are everyday m-commerce examples in Nepal.

Electronic Payment (E-Payment) Systems

E-payment systems are essential for e-commerce. They are systems that facilitate the acceptance of electronic payment for online transactions.

  • Examples: Credit card payment gateways, digital wallets (PayPal, Apple Pay), and bank transfers.

Types of e-payment

  • Cards — debit and credit cards used online or at POS machines.
  • Digital wallets — store money in an app and pay by tapping or scanning (eSewa, Khalti, IME Pay).
  • QR payments — scan a merchant’s QR code to pay from a bank or wallet app (Fonepay QR).
  • Internet and mobile banking — direct bank-to-bank transfers.
  • Interbank payment systems — such as connectIPS, operated by Nepal Clearing House Limited (NCHL), for transfers and bill payments.

In Nepal, Nepal Rastra Bank licenses payment service providers and operators and sets rules for wallet limits and security.

How an online payment works

flowchart LR
  C[Customer pays at checkout] --> G[Payment gateway or wallet]
  G --> B[Customer's bank or wallet checks balance and OTP]
  B --> G
  G --> M[Merchant receives confirmation]
  M --> D[Order is confirmed and shipped]

E-Governance

E-Governance is the use of information and communication technology to provide and improve government services, transactions, and interactions with citizens, businesses, and other arms of government.

  • Goals: To make government more efficient, transparent, and responsive.
  • Examples: Filing taxes online, applying for a passport online, and accessing public records through a government website.

Models of e-governance

  • G2C (Government-to-Citizen) — online tax payment, passport and licence applications.
  • G2B (Government-to-Business) — online company registration, e-procurement (e-bidding).
  • G2G (Government-to-Government) — data sharing between ministries and local governments.
  • G2E (Government-to-Employee) — online payroll and records for civil servants.

Nepal examples

  • Nagarik App — access to citizen services and records from a phone.
  • Inland Revenue Department (IRD) — online PAN registration and tax return filing.
  • Public Procurement Monitoring Office e-GP system — online bidding for government contracts.
  • Online passport and driving licence applications that reduce queues at offices.

Advantages and Challenges

Advantages Challenges (especially in Nepal)
24/7 access to shops and services Limited internet access and digital literacy in rural areas
Wider market reach for small businesses Low trust in online sellers; many buyers still prefer cash on delivery
Lower transaction and paperwork costs Online fraud, phishing, and fake websites
Faster, more transparent government services Delivery and logistics difficulties in hilly and remote areas
Digital records reduce corruption and delays Limited international payment options for consumers

Summary

The internet has spawned numerous transformative applications. E-commerce and its mobile subset, m-commerce, have revolutionized retail through B2C, B2B, C2C, and other models. These are powered by electronic payment systems—cards, wallets, QR codes, and interbank systems such as connectIPS—that facilitate online transactions. In the public sector, e-governance uses internet technologies to make government services more accessible, efficient, and transparent for citizens, though trust, access, and security remain challenges.

Key Takeaways

  • E-commerce is buying and selling online; m-commerce is e-commerce on mobile devices.
  • The main e-commerce models are B2C, B2B, C2C, C2B, and G2C.
  • E-payment systems—cards, wallets, QR, internet banking, interbank systems—are necessary to conduct e-commerce.
  • E-governance uses IT to improve government services through G2C, G2B, G2G, and G2E models.

Discussion Questions

  1. What are the main advantages of e-commerce for a consumer?
  2. What are some of the security risks associated with electronic payments?
  3. How can e-governance make a government more transparent?

Exam-Style Questions

Short answer

  1. Differentiate between e-commerce and m-commerce.
  2. What is a digital wallet? Name two digital wallets used in Nepal.
  3. List the four models of e-governance.

Long answer

  1. Explain the types of e-commerce with examples. What challenges does e-commerce face in Nepal?
  2. What is e-governance? Discuss its benefits with examples of e-governance services in Nepal.