A ticket to a smarter Bangladesh: Mass adoption of online ticketing for a smarter transport sector

Photo: Courtesy

Bangladesh has undergone a digital revolution in the last decade, and its impact is visible in all spheres of life.

In my ten years of building Shohoz, I have seen a massive change in the digital adaptation of our users. Typically, transportation in any country is one of the most chaotic and disorganised industries.

Our transportation sector is no different, however, it has evolved overtime, through embracing digitisation; the precursor of which was our pioneering work. With Bangladesh Railway implementing 100% online ticketing this year, we are at a pivotal point towards a truly digital Bangladesh.

As the government embarks on its commendable vision for Smart Bangladesh, it is imperative to prioritise the digitisation of a few services accessed by the masses on a daily basis. In this context, in my opinion–the transportation sector­ stands out as a prime candidate–given its indispensability to society. The Mobile Financial Services (MFS) players have done a tremendous job in bringing digital dividend to Bangladesh.

Now, it is crucial to ensure digitisation of services, particularly critical services like transport, as it's an everyday necessity. We understand the significant influence that changing ticketing services have by drawing inspiration from the success story of our neighboring country, India, where among the first services digitised were bus and rail.

By promoting the use of digital platforms for purchasing tickets, which is a crucial aspect of accessing transportation services, we can encourage millions of individuals to become habituated to use digital services on a regular basis.

When a large portion of the population embraces digital services in their everyday routines, they become better prepared and more open to utilising various other digital services, thereby accelerating the broader adoption to digitisation. Consequently, it's imperative – "A simple ticket can indeed transform lives".

Inspired by the successes in our neighboring countries in terms of early adaptation, I began Shohoz in 2014. For the bus operators, our proposition was simple: digitalising their operations would save pilferages and enhance their operational efficiency. Although we encountered many challenges, the primary challenge was the lack of digital literacy.

Nevertheless, I was taken aback to see how discerning the bus owners were–the true entrepreneurs of our country. With their help and support, we digitised over 8,000 counters in the past decade, expanding our coverage to include rural areas as well. Today, smaller out-of-Dhaka transport operators are also embracing our software solutions.  

For the consumers, online ticketing brings convenience, efficiency, and accessibility, saving time, and hassle. In a country of traffic jams, the value of such time and effort savings cannot be underestimated. Bangladesh Railway (BR) is a stellar example of delivering consumer convenience in this regard.

BR, an institution which Shohoz proudly serves, took a bold step this year, introducing 100% online Eid advance ticket sales during Eid-ul-Fitr and Eid-ul-Azha in 2023 through a system built and operated by Shohoz.  

Ensuring a smooth journey back home for people in this emotional holiday is a very critical objective of our government.  

Hence, the decision to transition everything online was a significant risk. Shohoz deployed over 1500 servers; 3.5 crore hits were recorded in one hour, demonstrating the system's improved performance during Eid. Through the mainstream and social media, passengers from diverse parts of Bangladesh expressed their satisfaction with the convenience of online ticket purchases. 

It is the first mass-level government service availed by people of all socio-economic backgrounds to have become completely digital. People went online, registered their National ID and bought tickets, showing that a majority of Bangladesh is ready for digital adoption.

Shohoz serves 2 million monthly active users – for a market of Bangladesh's size, that is a significant number that speaks to the status of digitisation.

However, as we look at our rail versus bus base, even though the bus industry is larger; adaptation of online ticketing by consumers has been slower in bus. This points to some critical factors, which, if addressed, could transform our country.

Key factors that contribute to the disparity:

1. Existence of multiple physical locations in various parts of the city where bus tickets are available. These physical "counters" cost a lot in terms of fixed cost to bus operators. However, it is difficult for a bus operator to let go of a current channel of sales in the hope of the new (online) channel, unless all their competitors do at the same time. That calls for a change in regulation – just like how the government made all rail tickets available online, we need a similar directive in the bus-ferry industry. We need to put a halt to the illegal counters spanning various residential locations in cities, and also give tax incentives for online sales to the bus operators. Only a few years of incentive can transform this industry and over the long run, will only help to increase government revenue collection.  In my opinion, such initiatives will take Bangladesh forward in its digital vision much faster.

2. Low data usage among a significant portion of the population. Despite positive growth in mobile phone users, internet subscriptions, and telecom density, data cost is very high in our country, inhibiting people's ability to consume it. In today's world, the internet should be compared to "air", and should be treated as a basic necessity of life by all governments. Thus, we need to make access to the internet inexpensive.

3. High payment charges. Online payment charge paid by consumers in Bangladesh is much higher than neighboring countries. Consumers are very price sensitive in our country and do not like paying these charges. Bus operators are also not willing to take these charges, which means they need to be paid by consumers. I would coin this as the fundamental reason why online adaptation of services is still behind. Payment charges has been subsidised in similar markets and such examples could be looked at from a policy perspective.  Government could do it for a few years to spur adaption and it will help to increase tax revenue by helping digitise many more services.

Online ticketing fuels development and prosperity. The success of BR in online ticketing gives us hope that Bangladeshis are ready for mass scale digitisation of services.

Through concerted efforts to address challenges, particularly in improving digital penetration, subsidising digital payment costs, limiting physical availability of services (where applicable), we can unlock the full potential of online ticketing, revolutionise the transport sector, and pave the way to a smarter and more connected future for Bangladesh. A rail or a bus ticket can indeed be a ticket to a smarter Bangladesh.

Maliha M Quadir is the Founding Managing Director of Shohoz, the largest ticket destination in Bangladesh.