The Open Network Digital Commerce (ONDC) network, led by the Government of India (GoI), has expanded its pilot to 15 new cities ahead of its plans to begin operations in August 2022.
- ONDC has expanded to Noida (Uttar Pradesh –UP), Lucknow (UP), Bijnor (UP), Faridabad (Haryana), Chhindwara (Madhya Pradesh -MP), Bhopal (MP), Kolkata (West Bengal), Pune (Maharashtra), Kannur (Kerala), Thrissur (Kerala), Udipi (Karnataka), Kanchipura (Karnataka), Chennai (Tamil Nadu -TN), Pollachi (TN), Mannar and Ramanathapuram (TN).
- The network first began its pilot in April 2022 in 5 cities: New Delhi (Delhi), Bengaluru (Karnataka), Coimbatore (TN), Bhopal (MP), and Shillong (Meghalaya).
Snapdeal, an e-commerce platform, has also signed an onboarding agreement with ONDC and will debut on it in August 2022 and will provide Pan-Indian access.
Open Network for Digital Commerce (ONDC)
i. ONDC is an initiative to promote open networks for all aspects of the exchange of goods and services across digital or electronic networks.
ii.It aspires to provide new opportunities, curb digital monopolies, and assist Micro, Small, and Medium Enterprises (MSMEs), as well as small traders, in gaining access to online platforms.
iii. It is an initiative of the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry (MoCI).
Reach of ONDC So Far
i. ONDC has on-boarded 100 merchants on its platform, with many of them digitising their catalogues in compliance with ONDC’s protocol.
ii.It is also in the process of completing a modest fundraising effort that will bring its overall fundraising amount up to Rs. 195 crore from the Rs. 157 crore raised earlier.
iii. The National Securities Depository Limited (NSDL), the National Payments Corporation of India (NPCI) and the Bank of India (BoI) are involved in the ongoing fundraising.
iv.The UPI-like platform ONDC was developed following pilot programs in a number of Indian cities to compete with the global e-commerce giants such as Flipkart and Amazon.
Snapdeal Set to Become the First E-Commerce Marketplace to Debut On ONDC
Snapdeal, an e-commerce platform based in New Delhi (Delhi), is slated to be the first e-commerce marketplace to debut on the ONDC platform.
- Snapdeal inked an onboarding agreement to join ONDC in early July 2022 and will launch on the network in August 2022 with three key categories—fashion, home & beauty and personal care.
i.This step would enhance Snapdeal’s current strategy of linking small and medium-sized sellers with a sizable and growing online market, particularly among buyers residing outside of India’s metro cities.
ii. Snapdeal will provide Pan-Indian access on ONDC and by the time it is launched, more than 2,500 cities and towns across the country will be enabled for access.
- Currently, Paytm’s buyer side is the only other significant platform on the ONDC.
iii.Both inter- and intra-city logistics will be provided by various third party providers that work with Snapdeal, and the company may potentially consider utilising the on-network logistics options given by the ONDC platform.
Note – According to a RedSeer report, the number of online buyers from tier-2 and smaller cities, which accounts for more than 80% of the population, will triple in five years. By 2026, it will increase to almost 256 million from around 78 million in 2021.
About Open Network Digital Commerce (ONDC):
CEO – Thampy Koshi
Established – 2021
