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E-Government and E-Commerce Issues in Malaysia

Conference Paper · June 2021

DOI: 10.1109/ICSCEE50312.2021.9498092

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 E-Government and E-Commerce Issues in Malaysia

Yousef A. Baker El-Ebiary Anas Ghassan Kanaan P. Ravindran Pathmanathan

Assoc. Prof. Ts. Dr. Faculty of
Informatics and Computing, UniSZA,
Malaysia
yousefelebiary@unisza.edu.my
Asst. Prof. Dr., Business & E-commerce International Institute of Applied
Depaetment, Faculty of Managment and Science of Swiss School of
Financial Sciences. Management, Netherlands
Petra University, Amman, Jordan, ravindran@unies.my
anas_Kanaan@uop.edu.jo

Nahg Abdulmajid Alawi Amer Hatamleh Julaily Aida Jusoh

Prof. Dr., Geomatika university college
Malaysia and University of Aden,
Yemen
dr.nahg@geomatika.edu.my
Asst. Prof. Dr., Head of Management
Information System Department,
Faculty of Financial and Business Science,
Irbid National University, Irbid, Jordan
aahatamleh@inu.edu.jo
Dr., Faculty of Informatics and
Computing, UniSZA, Malaysia,
julaily@unisza.edu.my

Lowai saleh aledinat Khairi Aseh Samer Bamansoor

Faculty of Informatics and Computing,
UniSZA, Malaysia
lowai.aledinat@gmail.com
International Institute of Applied Science
of Swiss School of Management,
Netherlands
kkhairi@gmail.com
Lecturer, Faculty of Computer and
Information Technology, MEDIU,
Malaysia and researcher, University of
Aden, Aden, Yemen,
Samer.ali@mediu.edu.my

Abstract—In Malaysia, an e-commerce company is still

considered a new middleman. As well as the development of
information and communication technology strongly affects
business companies at the present time in terms of management,
business strategies, production, sales and marketing, and other
aspects that underpin business profitability in general. E-
commerce, known as e-commerce, refers to a general term for a
commercial activity using modern technologies, or a commercial
transaction that includes the exchange of data via electronic
frameworks, especially the Internet, as well as many modern
systems used in personal computers, smart phones, etc. It is not
just limited to doing business between companies but also related
to online services between governments and individuals. Various
investigations related to e-commerce have identified obstacles
related to information technology (IT) organization, internet use,
financial situation, government and administrative activities as
important determinants of doing business online. Information
and Communication Technology (ICT) has revolutionized
businesses around the world. In this paper, e-commerce practices
in Malaysia are analyzed by their characteristics, drawbacks,
openings and risks. This paper provides a general review of the
current issues considered by e-commerce organizations today. It
also suggests the challenges and problems facing e-commerce
companies at the present time and how to solve them using e-
commerce concepts.
Keywords— E-Government, Electronic Commerce, Business
Models, Bandwidth, Hardware Infrastructure.
I. INTRODUCTION
In Malaysia, the e-commerce company is still considered as
a new medium. The information and communication
technology evolution is aggressively affecting the business
company nowadays. We regularly manage the utilization of the
web to internet shopping, to get data, get online administrations
and to speak with others such through skype, google meet,
Facebook, WhatsApp video call and others. The Internet plays
a significant role in building up an electronic commerce
company and in daily life style. The government is currently
striving to guarantee the development and investment on
internet communication and technology is used whenever
possible by all degrees of the community [1]. To comprehend
the inside and out of the electronic commerce platform and to
look at more responses for the investigation issues.
Investigation shows that electronic commerce in Malaysia is
moving towards an upswing course. However simultaneously
there are a couple of troubles which are influencing e-
commerce. The troubles, for instance, budgetary condition of
the country, low wages of workers, absence of consciousness
of web based buying and critical cost. In Malaysia, discoveries
show that there are better opportunities which can support
electronic commerce [2]. Key situations of the country,
political security, outside interest for Information and
Communication Technology (ICT) and high pace of training
can be the enchanting piece of electronic commerce
improvement in Malaysia. So, this study will investigate the

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151
challenges or problems faced by companies, especially in the
context of Malaysia, and how to solve that problem by
implement e-commerce concepts to ensure the system is safely
used and accepted by the people [3].
II. BACKGROUND OF THE STUDY
Internet businesses are those that occur on the Internet and
various other electronic media such as the phone, and on the
basis that the primary goal of commerce is to achieve the
benefit, it can be well said that an Internet business is an
interaction that includes all the income that occurs on the
Internet and related business plans, and the formation of Web
and promotion [4]. Online businesses, for example, promote
via Facebook and advertise on YouTube by recording display
registrations of items or departments that you submit on the
webpage and other well-known websites, and there are also
advertisements by undoing by clicking promotional
establishments in which you pay a sum and incubate The
organization to bring you a certain number of guests, (for
example, managing Google AdWords) and many alternative
methods have no restrictions [5].
Techniques in the so-called electronic commerce by
engaging in commercial activities through network systems,
but electronic commerce has become not only limited to sales
but goes beyond that to include commercial advertising and
commercial exchange between countries, consumers, and
producers, which facilitated the establishment of electronic
points of sale. Most of the e-commerce activities are done over
a network [6]. The Internet e-commerce is divided into three
main types, e-commerce between companies and companies,
electronic commerce between companies and customers, and
electronic commerce between clients and customers for the
purpose of acquisition and exchange between goods and
services. Electronically instead of direct physical contact,
electronic marketing depends mainly on the Internet in
practicing all marketing activities such as advertising, selling,
distribution, marketing research, designing new products,
pricing, and others, and according to the above, the relationship
between Internet Marketing and E-Commerce can be clarified
[7]. It is one of the tools of commerce. Either electronic
marketing is an element of the marketing of that trade.
In electronic commerce research, companies that apply
internet marketing whether it is small or large business has
become a significant topic. They often face hardship and
troubles because of the lack of assets and insufficient
knowledge in electronic commerce ideas [8]. The definition of
e-commerce is worldwide whereas electronic commerce carries
business transactions through various electronic mediums like
the internet, mobiles, ATMs, credit cards, fax machines and
others. Both electronic commerce and internet marketing are
important things in developing and maintaining successful
business companies. They must be available to the customer
24 hours per day without lack. Internet marketing is related to
various e-commerce business models that gives many benefits
and more convenience to consumers.
III. METHODOLOGY
These days’ e-commerce really requires the changing scene
of innovation, as a director needs to decide the expense and
advantage of progressing to another innovation. To remain
significant in this field, we need the most recent instrument that
will provide the best value performance to the company. To
resolve network issues, can take out the obvious
communication barriers such as terrible links, poor Wi-Fi flag
and guarantee the workstation’s system connector is designed
with the right DNS servers and right IP addresses [9].
In order to build a website, the desktop is no longer the
primary online shopping portal. Companies need to consider
transforming to mobile platforms since it is more friendly user
interface and can capture better imagination of the audience
through it. Next, companies need to keep clients faithful by
web based life stages to give all the more agreeable
promotions. To make it easier to target customers and increase
the reach of your brand, companies could use Facebook,
Pinterest, Twitter platforms by promoting campaigns there.
Focus on client care over benefit and it is simpler to keep up a
current client than to locate another one. By making
dependability programs, the focus can’t be moved to different
organizations, so the client should buy from you.
As an electronic commerce owner, you really need to have
an infrastructure based on the requirements and needs of your
company. An e-commerce infrastructure must usability and
versatility while picking the administrations for web based
business stages so delivering performance is proficient, not
slowed down and does not crumple during extra
administrations.
IV. E-COMMERCE BUSINESS PLANS OF ACTION
Web-based business plans of action are planned with the
two principal parties associated with them as a main priority.
One is the specialist co-op or dealer, and the other is the
shopper or the client, see Figure 1 [10].
Fig. 1. e-commerce Business Models
152
 How about we presently go to the various sorts of internet
business plans of action: e-commerce business plans of action
A. Organization to Business (B2B)
Consolidate internet business, organizations sell their items
or administrations over the Internet to other business elements.
Indeed, even data trade between associations happens through
EDI. For instance, wholesalers can contact organizations of
expected purchasers to sell mass products on Indiamart.com.
B. Business to Customer (B2C)
The most famous of all online business models is B2C. It
alludes to the offer of merchandise or administrations by
business substances to clients (people) over the Internet. For
instance, garments organizations offer their items to customers
on Jabong.com.
C. Customer to the client (C2C)
At the point when a client (anybody) offers an item or
administration to someone else or a client through an online
medium, it is known as the C2C web-based business model.
For instance, somebody offers their trade-in vehicle to
someone else on cardekho.com.
D. Customer to Business (C2B)
It is the electronic plan of action where the client or
individual serves the necessities of the business associations
and furthermore decides the cost of the item or administration
on the web. For instance, content scholars turn out
autonomously for enormous substance composing
organizations or sites at freelancer.com.
E. From government to resident (G2C)
At whatever point the public authority distributes any data,
official warning, or other authority correspondence to people
(for example residents of that specific country) through an
online medium, it is known as a G2C structure. For instance,
usajobs.gov uncovers the most recent employment
opportunities for USA residents.
F. Customer to Government (C2G)
The online correspondence or trade of data by residents
with the public authority is known as the C2G internet business
model. For instance, rounding out an annual expense form on
incometaxindia.gov.in
G. Business to Government (B2G)
Business associations offer types of assistance, products, or
data electronically to the public authority at a specific expense;
This kind of web-based business is known as B2G. For
instance, the public authority is transparently welcoming
business substances to fill offers for numerous administration
projects on etenders.gov.in.
H. Business for Employees (B2E)
In the B2E web-based business model, organizations offer
types of assistance and even items to their representatives
utilizing intranet innovation. For instance, giving credit
administrations to workers through the Internet.
V. E-GOVERNMENT IN MALAYSIA
The Malaysian government has launched the final version
of its e-government project (myemail.my) since 2015. This
project, if successful, will inevitably change the perceptions of
communication in the region and perhaps even in the world. In
a nutshell, the idea of the project revolves around building a
private email system to communicate with the Malaysian
government only. So that every Malaysian citizen over the age
of eighteen, after carefully verifying his identity (using his
fingerprint) [11], can create an account in it to be a secure and
official way to communicate with the government and benefit
from the e-government applications there.
The project was implemented by the Malaysian company
Tricube Berhad, in cooperation with Microsoft, under the
supervision and control of the Malaysian government through
its relevant organizations. The importance of the project - as I
see it - is summarized in 4 very important points:
 Confidentiality and security: All messages within the
e-mail system will be encrypted during transmission
and preservation, which will preserve the
confidentiality of the information and data
communicated.
 Verification: Unlike regular email, the identity of the
account owner is verified personally and accurately,
which will ensure to a large degree to the government
that the recipient of the mail is really the person
requested. Also at the identity management level, the
email address of a Malaysian citizen may be treated in
the future just as the ID card number in Saudi Arabia is
currently treated, for example, as an official approved
identifier.
 Additional technical services: This project will be used
to develop technical services, especially with regard to
the application of e-government. For example, a single
sign-on service will be provided to system users. Once
you have successfully logged into your account in the
email system, you will be able during the same session
to visit different government websites and benefit from
their applications without the need to be verified. Your
ID to log back in every government website you visit.
Economic benefits: According to the company that
managed the project, the Malaysian government will save
approximately 50% of the value of what it spends on paper and
postal services that it currently uses to communicate with
citizens. Although the government is obligated to pay 50 cents
(approximately 63.5 halalas) to the executing company for
every “message” it sends to every citizen.
It is important to point out here that this system should not
be used in any way in any personal correspondence between
citizens in order to preserve their privacy, even if the messages
are encrypted. However, the published specifications of the
project did not clarify whether it would allow citizens to
communicate with each other using the e-mail system for
153
communicating with the government. Also with regard to Fig. 2. The Expansion on Malaysian e-commerce
collecting and checking fingerprints, this should be done
exclusively through trusted government agencies, as this vital The digital economy contributed 22% to the Malaysian
data is the most private data for any citizen, and care must be economy last year, accounting for RM267.7 billion of total
taken to ensure its confidentiality and preservation. national revenue, according to the Malaysian Ministry of
Statistics, also Figure 3 shows the growth on e-commerce in
The project, which has been in operation since June 2010, Malaysia in 20 years [14].
aims to reach 100% of Malaysians who are over eighteen years
old and have an account in the e-mail system for
correspondence with the government in 2015 [12].
It may seem a bit ambitious to some, but due to my interest
in the field of electronic identity and my knowledge of their
pioneering experience in the field of “smart” national identity
(since I worked there and in the company executing the smart
electronic identity project for several months) I know that
Malaysians are able to achieve this The ratio over the next four
years!
In conclusion, it seems that the idea of the government
paying 50 Malaysian cents for every message it sends to every
citizen through the system provoked a large number of
Malaysians who see this as a waste of public money, so they Fig. 3. The acceleration of e-commerce in Malsysia
created a website (ohmy.my) with exactly the same design as
the project page, but with content that warns of the project and As for e-commerce, the sector contributed around 8% or
its implementing agency. However, the project manager RM115.5 billion in 2018 and registered RM447.8 billion in
responded to these criticisms by reminding him of the expected transaction revenue in 2017, compared to RM398.2 billion in
government savings after the project was activated, especially 2015, Figure 4 shows the top e-commerce platforms and
since the Malaysian government did not pay a single cent to applications in Malaysia [15].
implement the project.

VI. E-COMMERCE AND DIGITAL ECONOMY IN MALAYSIA

Malaysia's e-commerce sector has boosted the digital
economy to attract global investors and generate higher
revenues, according to the Secretary-General of Malaysia's
Ministry of Communications and Multimedia, the government,
through its National E-Commerce Strategic Roadmap, has
formed a framework that will help entrepreneurs embrace
digitalization for the retail ecosystem.
According to The Malaysian Reserve, “For the national e-
commerce strategic roadmap, it is critical that Malaysian
entrepreneurs are ready to become part of this progressive and
transformative web-based ecosystem.” With the right next-
generation infrastructure, advanced solution providers, and
innovative digital services, the e-commerce sector in Malaysia
is currently experiencing rapid growth. We cannot stop here.”,
Figure 2 illustrate the expansion of e-commerce market in
Malaysia [13].
Fig. 4. The Map of e-commerce in Malaysia
However, small and medium entrepreneurs are still in the
thick of initiatives to help them adopt digital technology, which
may hinder their financial development. While various
initiatives from government agencies, associations, and private
sector actors have been developed over the years to engage and
modernize these companies, most companies are still in the
midst of these initiatives [16]. The focus should be greater on
e-commerce as it has proven its ability to develop the digital
economy. E-commerce will be the fastest-growing component
VII. E-COMMERCE ISSUES AND CHALLENGES
Building up an electronic commerce business is hard, you
must have a great team and extraordinary group to take
incredible consideration over everything, from site support
through to client care. Basically, the basics of internet business
are to improve internal communication processes and help the
administration in optimizing resources by expanding the
proficiency of organizations [12]. In any case, organizations
that have embraced e-commerce face better standards. In
addition to controlling them in completing promoting exercises
through websites and emails, internet business has value-based
abilities. The capabilities ought to have the option to help them

154
in decreasing operational expenses with negligible design and
they can go to mechanized procedures which can reduce
routine employments [13]. So, here are the challenges or
problems e-commerce companies face all the time [14].
 Network problems which are data transmission have
gotten one of the significant issues these days. The
internet has gotten significant in our day by day life as
chairmen, director, staff or purchaser. Since internet
access is so important, technology team members must
ensure that on their side everything is pleasantly
arranged and improved. It is necessary to measure the
number of clients and gadgets that are relied upon to be
associated with that arrangement and furthermore
imperative to make the vital firewall to shield from any
dubious things.
 Infrastructure equipment, the company itself who
conducts business through mobile devices must be
capable of overseeing and supporting a huge base of
mobile clients or employees. Infrastructure is the
foundation that makes your business stand out and will
have an optimized business performance. There are
some significant equipment parts that we should
accentuate are an intermediary server, PCs, centres,
switches and others.
 Security issues which covers data security in electronic
commerce companies, each gathering associated with
an exchange should have the option to approve its
correlative and need to ensure that got messages are
not interfere with and acknowledge they begin from
the correct senders and also to keep the correspondence
content remain classified.
 To maintain client reliability is part of the problem in
electronic commerce companies. Business will
undoubtedly battle without customer trust and loyalty,
although with the best version of a website. To make
new clients and afterward keeping them up requires a
great exertion. One reason electronic commerce
companies specifically face a test in building client
trust and dedication is the seller and buyer do not know
each other plus they cannot see one another. In this
way, the client is robbed of the senses they would
regularly depend on in up close and personal
exchanges. This can only be made up for through time
and hard work. Over various exchanges, eventually,
the organization can fabricate this trust and reliability.
You should ensure the client is happy with the entire
procedure, from requesting on the web to delivery. A
lot of online retailers might be selling a similar item, so
you should distinguish upper hand and sustain your
client care as needs be.
VIII. DISCUSSION
There are two names simultaneously for electronic
commerce: electronic commerce and e-business. E-commerce
is the process of commercial exchange (buying and selling) of
goods and services via the Internet. E-business is the
implementation of all the company's business electronically
while performing the business of a common nature with other
companies through electronic communication. While the e-
government (E-Government) is concerned more with providing
services to citizens and making them more available at all
times (24 hours a day).
The real difference between the above-mentioned electronic
transactions is the goal of the facility and not the technology
used, the goal of e-commerce is to reach the consumer to
facilitate the process of buying or selling. In addition to e-
commerce goals, government business is also concerned with
performing its business with other partners electronically,
while preserving citizen service, which is one of the most
important goals of government implementation. We can
dispense with the idea of e-government and replace it with
government business if we make the fundamentals of
government work coincide with commercial theories by
increasing productivity and rationalizing expenses while
preserving the quality of service performance (for the citizen),
especially when considering fees are the income of this facility
in which its budget is determined. If it is one of the government
establishments that serve the citizen without fees, then the
value of the services provided is evaluated by the Ministry of
Finance, which allocates its budget accordingly.
Most of the developed countries have tended to provide
their services in the concept of e-business, not just e-
government, in order to motivate their employees to improve
their performance and change the old ideas rooted in
government work, and that promotions and financial bonuses
are based on performance and not on the length of service.
The most difficult obstacle facing the implementation of
such an idea is the traditional working methods in government
departments, which do not favor administrative change
processes. From the first glance, the decision-maker in any
government establishment will refuse to change the standards
and principles of administrative work in his facility, but I hope
that an executive body will be established to develop
government administrative systems to keep pace with the
developments of modern management theories and to facilitate
the application of the e-government project.
The Internet is relevant to electronic commerce by
permitting people from everywhere throughout the world to get
associated and permits businesses to sell their products and
services online. Issue of trust in electronic commerce is
important because the internet will never gain its financial
potential if buyers cannot believe that individual data is
sheltered and secure. Companies should be clear about their
business objectives, vision and mission in developing e-
commerce platforms.
They should understand that the concentrate is no longer on
whether to deploy electronic commerce but how to convey its
gainfulness, as electronic commerce experience assumes a
huge job towards improving organization’s execution. The
organizations must be eager to put resources into mechanical
framework, especially in equipment, programming, and mix of
the frameworks just as human abilities by recruiting IT work
force with suitable information and skills to develop electronic
commerce applications.
155
 IX. CONCLUSION
This paper proposes the challenges and problems faced by
electronic commerce companies nowadays and how to solve it
by using electronic commerce concepts. To survive in the
electronic commerce industry is not easy and it requires
extraordinary systems. Team members must be set up for
challenges and aim for growth at each stage to success in this
area. This revolution has already started, however it is as yet
ambiguous in our nation yet when it is done, the transformation
will affect various parts of regular day to day existence that can
help leaders by giving significant information continuously and
eventually will change the manner in which we work together.
Government and industry must cooperate on encryption and
settling, by cooperating issues can be unraveled quicker and
can decrease cost just as be progressively productive.
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