As Sri Lanka’s digital economy continues to evolve, online shopping has become an integral part of daily life. However, despite increasing internet penetration and the rapid growth of e-commerce platforms, many consumers remain reluctant to place their full trust in digital transactions. For a significant number of Sri Lankan shoppers, cash-on-delivery continues to be the preferred payment method, highlighting a persistent trust gap that could influence the future trajectory of the country’s digital commerce sector.
Addressing this issue, SLIIT Business School conducted an in-depth study led by Prof. Ruwan Jayathilaka in collaboration with Ms. Isuri Udara, who carried out the research as part of her MBA programme. Titled "Security Matters: Empowering E-Commerce in Sri Lanka Through Customer Insights," the study was published in Humanities and Social Sciences Communications, a prestigious journal published by Springer Nature and ranked among the top one percent of Scopus-indexed journals in its field.
The research explored the key factors shaping customer perceptions of security when using e-commerce platforms in Sri Lanka. Using data gathered from online shoppers through both online and face-to-face surveys, the researchers applied advanced econometric techniques to identify the elements that strengthen—or undermine—consumer confidence in digital shopping.
The findings reveal that consumer trust extends far beyond attractive discounts, convenience, or brand recognition. Platform quality, robust vendor security systems, website reliability, secure payment authentication, privacy protection, recognised security certifications, fast page loading speeds, and an overall seamless user experience emerged as the most influential factors driving confidence in online transactions.
The study also found that many Sri Lankan consumers remain wary of making online payments due to concerns about financial data misuse, inadequate data protection, counterfeit products, delayed refund processes, payment failures, and the storage of bank card information. These concerns continue to reinforce the popularity of cash-on-delivery, even as more consumers rely on digital platforms to browse products, compare prices, and complete purchases.
"Digital businesses cannot thrive without customer trust," said Prof. Ruwan Jayathilaka. "Consumers may visit an online platform once, but if they have concerns about payment security, privacy, or system reliability, they are unlikely to return. Understanding these perceptions is therefore essential for the long-term success and sustainability of e-commerce businesses."
The research delivers a clear message to the business community: building digital trust is no longer solely a technological challenge—it is a strategic business imperative. E-commerce platforms, online retailers, fintech companies, and digital startups must prioritise investments in secure payment infrastructure, transparent privacy policies, effective customer communication, stronger authentication mechanisms, and high-performing digital platforms to strengthen customer confidence and encourage long-term loyalty.
As Sri Lanka accelerates its digital transformation, the study underscores that consumer trust will remain one of the most decisive factors in unlocking the full potential of the country's e-commerce ecosystem.
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SLIIT Business School Study Reveals Sri Lanka’s Digital Trust Gap Despite Rise in Digital Payments
