OPEN APP
Home / Industry / Retail /  How ONDC seeks to democratize digital commerce
Listen to this article

The department for promotion of industry and internal trade (DPIIT) in the ministry of commerce and industry is building an open network for digital commerce (ONDC), designed to curb digital monopolies and standardize the on-boarding of retailers on e-commerce sites.

What does the ONDC aim to achieve?

The Unified Payment Interface (UPI) has disrupted the digital payments domain. ONDC seeks to achieve something similar for e-commerce. It aims to “democratize" digital commerce, moving it away from platform-centric models like Amazon and Flipkart to an open network. ONDC may enable more sellers to be digitally visible. The transactions will be executed through an open network. According to people in the know, the system may empower merchants and consumers by breaking the silos that exist today. It will eventually touch every business, from retail goods and food to mobility.

How would ONDC work?

The ONDC is still work in progress and the details are sketchy. But here is what we know: the network may make it easier for a small retailer to be discovered. Once a retailer lists its products or services using the ONDC’s open protocol, the business can be discovered by consumers on e-commerce platforms that follow the same protocol. A consumer searching for the product can see the location of the seller and opt to buy from the neighbourhood shop that can deliver faster compared to an e-commerce company. This may promote hyperlocal delivery of goods such as groceries, directly from sellers to consumers.

Fear of monopolies
View Full Image
Fear of monopolies

Who will guide the development process?

There’s an advisory council which includes R.S. Sharma, chief executive of the National Health Authority; Nandan M. Nilekani, non-executive chairman of Infosys; Adil Zainulbhai, chairman, Quality Council of India; Anjali Bansal, founder and chairperson, Avaana Capital; and Arvind Gupta, co-founder & head, Digital India Foundation, among others.

What are the next steps?

A private sector-led non-profit unit will be set up to fast-track its roll-out. It is expected to provide a startup mindset enabled by a management with a futuristic vision, deep understanding of commerce, comfort with cutting edge technology and a “missionary outlook" to drive change. “A non-profit company structure removes any incentive for profit maxi-mization, keep focus on ethical and responsible behaviour while providing for trust, rigorous norms of governance, accountability and transparency," DPIIT said.

What are the next steps?

A private sector-led non-profit unit will be set up to fast-track its roll-out. It is expected to provide a startup mindset enabled by a management with a futuristic vision, deep understanding of commerce, comfort with cutting edge technology and a “missionary outlook" to drive change. “A non-profit company structure removes any incentive for profit maxi-mization, keep focus on ethical and responsible behaviour while providing for trust, rigorous norms of governance, accountability and transparency," DPIIT said.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Close
Recommended For You
×
Edit Profile
Get alerts on WhatsApp
Set Preferences My ReadsFeedbackRedeem a Gift CardLogout