Courier companies in Pakistan are experiencing a notable decline in operations as e-commerce orders from customers, particularly small and mid-sized sellers, drop sharply. While major brands continue to maintain steady shipments, smaller online businesses, especially in less urbanized cities, are witnessing a slowdown that is affecting overall logistics volumes.
Cash-on-delivery (COD) trends have been uneven. New and small-scale shippers have faced temporary suspensions, whereas large brands with verified documentation have maintained consistent order flows. According to Abdul Aleem Shaikh, Director of Marketing and Communications at Leopard Courier, COD business has decreased by roughly 30% to 38% in recent weeks.
Recent government regulations require online sellers to register with logistics providers and obtain an NTN (National Tax Number) to operate legally. Additionally, COD and digital transactions are now subject to taxes of up to 2%. “We’ve seen more online traders attempting to complete their registrations, but many small businesses, particularly home-based women entrepreneurs, remain unfamiliar with tax procedures or hesitant due to financial concerns,” Shaikh explained. Rising fuel costs and additional documentation requirements are also squeezing profit margins for courier companies.
Major e-commerce brands in Pakistan have complied with the new regulatory framework, which has allowed them to continue business without disruption. However, mid-sized and smaller sellers have struggled during the registration process, causing interruptions in courier operations. Rana Hassan Talal, CEO & Founder of AHL Courier, noted that many small sellers’ operations were suspended for nearly two weeks, directly impacting courier business volumes.
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The government also briefly imposed a 5% tax on international platforms like Temu and AliExpress but later withdrew it. Shoaib Bhatti, President of the Pakistan eCommerce Association, criticized this move, stating that taxing local businesses while exempting foreign platforms creates an unfair market environment.
Local courier companies have absorbed some of the additional COD tax, but many small sellers are losing competitiveness. Experts urge authorities to reduce COD taxes to a flat 0.25%, extend registration deadlines, and simplify documentation processes to support the growth of domestic online businesses.
