Open Network for Digital Commerce (ONDC) is likely to collaborate with the Ministry of Cooperation soon to scale up its businesses and tap a bigger market, said a source from the Ministry of the Commerce. Even after more than three years of its launch, ONDC is still struggling to get into the market dominated by e-commerce giants like Amazon and Flipkart. This tie-up could help sellers from several co-operative groups to list themselves on ONDC.
“We are working on several strategies to scale up the business and market reach. Talks are on to collaborate with the Ministry of Cooperation to upscale the business,” said the source.
Department for Promotion of Industry and Internal Trade (DPIIT) launched ONDC as a public, open-sourced network for e-commerce, using open specifications and protocols to democratize digital commerce in India. It was designed to break the dominance of large e-commerce platforms and create a level playing field for small businesses and sellers. Since its inception, it has tried to onboard small and medium sellers from tier 2 and tier 3 cities of India. One of the major incentives offered by ONDC to the sellers was near-zero platform fees.
While the initial days look promising, by the early months of 2025, retail orders fell to a twelve-month low of 4 million in May, down 6.2% from April’s 4.3 million. Retails’ contribution to ONDC’s total transactions has fallen nearly from 47% in October to just 25% in May.
Despite the government pushing for ONDC, there has been minimal response from the customers. In fact, customers have often complained about complicated user interface and some even complained about poor customer service.
To further diversify their business, ONDC has also ventured into financial services as it boarded Zerodha Fund House. It also recently launched unsecured digital loans that can be sanctioned within six minutes, and plans to roll out GST invoice financing loans by September 2024.
Recently, Rohit Lohia has been appointed as the chief business officer (CBO), who has previously served as the senior vice-president at Paytm, backed by One97 Communications.
Attachments: