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Monday, December 5, 2022

Govt’s Ecommerce Framework To Launch In April; Concern For Amazon, Flipkart?

Open Network for Digital Commerce (ONDC), the open public digital infrastructure framework, is expected to launch its beta version in April.

Full Launch

Anil Agrawal, the Additional Secretary-DPIIT, Ministry of Commerce & Industry said that five cities- Delhi, Bangalore, Coimbatore, Shillong and Bhopal- have been identified because of their geographical reach.

They have a trader base in these five cities that is getting ready to deal with the intricacies of transacting on ONDC.

Beta testing will be completed by the end of April, with the full launch occurring in August.

Purpose And Objectives

ONDC is in talks with Paytm, Dunzo, PhonePe, GoFrugal, GrowthFalcons and Microsoft.

In December 2021, a new initiative was launched.

By doing so, it seeks to control digital monopolies and increase inclusivity within the digital commerce ecosystem.

With that in mind, it is expected to benefit millions of small retailers who cannot currently access ecommerce platforms.

Inception 

It is difficult for small kirana merchants to create a catalog, manage their inventory or order requirements for which they need a lot of assistance.

There are six crore small retailers in the country, but only 15,000 have adopted ecommerce. During the pandemic, the government was trying to connect citizens in containment zones with suppliers of essential commodities and the idea was born. Due to the fact that different people use different apps, problems arose.

Standardisation

As a result, the government began thinking about standardisation and the ONDC was born. It would function as a central registry, so sellers would be registered here instead of on a platform.

Then everyone onboard would follow the same protocol, anyone buying something would check the registry first. A seller gets visibility across all platforms instead of only being visible on one.

Unbundling

Unbundling was the biggest advantage of ONDC. Today, you get all the services bundled together in e-commerce. If a person wants to buy from a particular vendor, they will incur a cost that is either without delivery or with delivery. The order can then be picked up by the customer.

According to Agrawal, almost 80 major companies have been working with their technology teams to integrate into the ONDC network.

Cross-Selling

According to Agrawal, they are not trying to disrupt existing players such as Amazon and Flipkart.

Rather, it is about democratizing and making it easier for small traders to access the online commerce framework, which is difficult at the moment.

He pointed to another major benefit of ONDC.

A customer on Amazon can only buy from sellers on the site.

And if a seller is on Flipkart, they can only sell to customers registered with the website, meaning they cannot cross sell, something which ONDC will enable sellers to do.

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