Malaysian government reviews the impact of e-commerce platforms on SMEs and the retail sector

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Study on the impact of e-commerce on SMEs

Highlights

The Malaysian government is examining the impact of e-commerce platforms on SMEs and the retail sector following traders' concerns over market imbalances.
The Malaysian Communications and Multimedia Commission has been instructed to invite all e-commerce platforms, shop owners and SME operators for initial discussions.
The government is focusing on the issue of low pricing by e-commerce platforms that harms the local economic ecosystem and the sales, retail and courier sectors.

This article was translated from the original. Read the original version by our correspondent here.

Initial steps involve e-commerce platforms

As reported by The Edge Malaysia, Communications Minister Datuk Seri Fahmi Fadzil said the government is examining the impact of e-commerce platforms after traders raised concerns about potential market imbalances. He said the Malaysian Communications and Multimedia Commission has been instructed to invite all e-commerce platforms to discuss the matter as an initial step towards addressing the issues raised.

Fahmi said he and Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani will meet with e-commerce platforms, as well as affected shop owners and SME operators. According to him, the approach aims to obtain direct feedback from the parties involved before any follow-up measures are decided.

He also stressed that the government does not intend to prevent traders and entrepreneurs from using e-commerce platforms as business channels. However, the sector's growth must be managed so that it does not harm the local economic ecosystem.

Wider impact on trade and courier services

The discussions will also focus on the practice of selling products at excessively low prices or below market prices, which Fahmi said could harm local businesses. The issue, he said, is not limited to the e-commerce industry alone, as its impact is also felt by the sales, retail, postal and courier sectors.

Fahmi said the matter requires a comprehensive approach and coordination among several ministries and agencies. The effort will involve the Malaysian Communications and Multimedia Commission, the Ministry of Domestic Trade and Cost of Living, the Ministry of Investment, Trade and Industry, the Ministry of Finance, the Inland Revenue Board and related agencies.

In our previous report on the Sumbangan Asas Rahmah (Sara) for All programme, we highlighted consumer survey findings showing that the RM100 aid remains difficult to use widely at popular stores due to limited merchant coverage and a restricted list of eligible items. The survey also suggested expanding merchant and product categories—including convenience stores, pharmacies and fresh goods—to reduce the need for consumers to switch stores or travel farther to redeem the assistance.

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