Democratisation of e-commerce is the need of the hour

The proposed Open Network for Digital Commerce (ONDC) is incorporated as a private non-profit (Section-8) company to establish the public digital infrastructure needed to expand access to India’s e-commerce ecosystem – and is expected to bring a US$200 billion opportunity by 2027.

The Indian government hopes it will democratize the country’s online commerce for all buyers and sellers, irrespective of their size, so that millions of small retailers and mom-and-pop (kirana) stores get an equal opportunity. India is keen to level the playing field for e-commerce operators and widen the digital market access for millions of small businesses and traders in the country.

The duopoly of Amazon and Walmart-Flipkart will end. This could be ecommerce’s UPI moment. The Unified Payments Interface (UPI) has become a symbol of India’s ability to roll out world-class solutions in digital technology. In 2021-22, 46 billion transactions valued at Rs 84 lakh crore were made on UPI.

A pilot phase of the ONDC protocol was recently launched in five cities, in the country, now it is closely involved in the development of ONDC, along with a team of technocrats and government officers, Nilekani has drawn praise for the initiative from diverse quarters, including Anand Mahindra, Chairman of Mahindra and Mahindra.

After UPI (Unified Payment Interface), it is said to be another game changing idea to democratise commerce - ONDC to select consumers, sellers and logistics providers. The project is massive and it is expected to bring a world of choice, convenience and transparency.

India's long-term consumption and retail growth drivers are expected to provide a strong foundation for future growth. There was a need for building cost-efficient and technology-enabled operations and partnerships would be key to success in the days to come. Experts say, End-to-end testing is being done to create a playbook with an aim to launch it in 100 cities in six months [by October 2022].

ONDC is based on interoperability where all platforms will talk to each other. The ONDC system is different from the operational models of existing e-commerce companies in India and abroad where buyers and sellers are restricted to their respective platforms. All it shows, how India is keen to level the playing field for e-commerce operators and widen the digital market access for millions of small businesses and traders in the country.

Experts says, ONDC as an alternative to platform aggregators like Amazon and Walmart-owned Flipkart, who have thus far monopolised India’s e-commerce landscape. Leading online retail aggregators are also on wait-and-watch mode to assess whether they can participate on the open-source network as well.

The ONDC will provide equal opportunities to all marketplace players, including consumers. It is a neutral platform that will set protocols for cataloguing, vendor match, and price discovery on an open source-basis, like the Unified Payments Interface (UPI). 

S Mohini Ratna, Editor, VARINDIA