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ONDC intends to move e-commerce from the current platform-centric model to an open network model and aims to be what #UPI is to the digital payment domain.
The ONDC initiative can be a UPI style disruption in E-Commerce in India and has the potential to take a center-stage and Indian banks are rushing to buy a stake in Open Network for Digital Commerce (ONDC) project!
So what is ONDC?
For starters, ONDC is an open network that enables buyers and sellers to connect digitally across various platforms. It envisions to have interoperability across e-commerce applications. Just like UPI works for payments.
To dwell deeper, currently the buyer and seller both need to be registered users on the same e-commerce application (like Amazon or Flipkart) to be discovered & transact. Now what if, buyers from Amazon have visibility of products from the likes of Flipkart, Snapdeal etc. and can transact without going to another platform or registering there!!
So basically, the intention is to provide seamless buying and selling experience which provides cross-platform interoperability.
ONDC will promote digital infrastructure by scaling and innovative open-source APIs and open protocols
ONDC has identified five cities to launch a pilot next month and is aiming to start nation-wide operations by August 2022. This platform will enable any service provider or seller to make itself visible to all e-commerce platforms and will significantly give a boost to the small digital sellers, breaking away the monopoly of the biggies.
This platform intends to digitise the entire value chain, encourage suppliers inclusion, systematising operations, derive efficiencies in logistics, and ultimately enhance value for consumers.
Numbers wise, there are over 4,200 small and big e-commerce companies in India, 500 logistics companies that deliver goods from the portals to customers, and more than 20,000 companies that provide services through e-commerce including travel, hotels, etc. This platform will bring all of them under one-roof!!!
While we await the Beta launch, few things are clear of what it is NOT :
✘ It is NOT a platform of platforms or a Super App of e-commerce.
✘ It’s certainly NOT another aggregator.
✘ It will NOT be an intermediary for the retailers.
✘ It is NOT a Government regulatory body.
Theoretically brilliant but practically it is gonna be a tough thing and we hope the best for the industry to evolve!!
The idea of a decentralized networks powered by open protocols is exciting, as it allows many new players to innovate and expand the market.
We are seeing a richer suite of open protocols and services emerge that are built on top of “India Stack”. It will take couple of years to see this play out like UPI.
But the time has come to move from Platforms To Networks!
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