Capital-rich transportation giant Rapido has revealed aspirations to grow from its existing presence in 120 locations to 500 nationwide. According to a statement from the firm, the growth plan will begin in February and be implemented progressively in several phases, with the goal of meeting the various transportation demands of its consumers. The startup’s initial rollout would focus on states like Karnataka, Gujarat, Tamil Nadu, West Bengal, and Rajasthan. After that, it would provide its services to other states, including Punjab, Haryana, Uttar Pradesh, and Uttarakhand. On the fringes of the 2025 Bharat Mobility Expo, the announcement was made. The schedule for carrying out the expansion plans is unclear, though. “Our expansion to 500 cities is a testament to our commitment to empowering individuals and building a more connected India,” said Pavan Guntupalli, cofounder of Rapido, adding that the platform has over 1.3 Cr captains (riders) earning over INR 15,000 Cr.
Expansion Aligns With Recently Raised Funding
After obtaining $200 million in its Series E fundraising round, led by current investor WestBridge Capital, which boosted the ride-hailing startup’s valuation to $1.1 billion, Rapido became a unicorn six months prior to the growth plan. Rapido claimed at the time that the investment will help the company grow its business throughout India. Rapido, which was founded in 2015 by Guntupalli, Rishikesh SR, and Aravind Sanka, mostly works in the auto and bike taxi industries. In December 2023, it launched a subscription model and entered the taxi services market. Additionally, it uses Rapido Local to provide peer-to-peer distribution services.
Financial Dynamics of Rapido
According to the business, 3.6 million rides are made every day, and more than 200 million rides have been made in 120 locations so far. In the fiscal year 2023–2024 (FY24), Rapido’s operating revenue increased 46% year over year (YoY) to INR 648 Cr, while its net loss decreased 45% YoY to INR 371 Cr. The startup faces competition from established firms like Uber and Ola, as well as up-and-coming firms like Namma Yatri, which is supported by Google.
Namma Yatri Has More Than One Crore Users
Even as it expands into more recent Tier 2 and 3 cities, Uber’s rival Namma Yatri, an interoperable ride-hailing app on the government-backed Open Network for Digital Commerce (ONDC), has surpassed the milestone of 1 crore registered users. 7.49 crore journeys from various cities, including Bengaluru, Kolkata, Chennai, Kochi, Tumkuru, and other states, have been accomplished by the ride-hailing app. As a result, as of January 18, 2025, drivers earned a total of INR 1,206 crore. Beginning in Bengaluru in November 2022, Namma Yatri has spread to a number of states, including Tier II and Tier III cities like Asansol, Cuttack, Mysuru, Tumkuru, Siliguri, and Bhubaneswar.
According to reports, Aditya Birla Capital has declared that all three of its primary services—lending, insurance, and investments—will be integrated on the Open Network for Digital Commerce (ONDC). Aditya Birla Capital Ltd. (ABCL) asserts that this makes it the first financial services firm to incorporate all three of the main products on the network supported by the government. According to the media reports, ABCL stated that the action is intended to improve user experience and make it easier to access financial goods on the site. India’s digital public infrastructure has grown quickly in recent years, establishing networks that are open and compatible with one another.
According to ABCL CEO Vishakha Mulye, the company’s partnership with ONDC will enable it to reach every corner of “Bharat” and meet the financial requirements and goals of customers who might not have had access to official credit, insurance, or investment possibilities in the past. Thampy Koshy, CEO of ONDC, commented on the collaboration, saying that Aditya Birla Capital’s integration demonstrates their dedication to democratising financial products. This action enhances ONDC’s financial inclusion aim while broadening its product options.
Giving Wider Variety and Options to Customers
As part of the partnership, ABCL’s goods will be accessible on ONDC through a number of buyer apps, allowing consumers to obtain financial products straight away without having to download extra software. However, the network will be able to expand its fintech play by bringing on new participants. It is important to remember that ONDC has long been developing the infrastructure for investments, insurance, and credit. It collaborated with ABCL as part of the credit integration early pilot.
Aditya Birla Health Insurance and Aditya Birla Sun Life AMC, two of ABCL’s major businesses, have also implemented mutual fund and health insurance products on the state-backed network. Just one week has passed since CEO Koshy stated that the volume of transactions on ONDC has increased by almost three times since December of last year. He also stated that the network intends to increase the volume by an additional seven to eight times by December of 2025.
Growing Network of ONDC
ONDC, an open network for the exchange of goods and services via digital networks, was introduced in 2021. It says it has 200 apps and is available online in more than 611 cities. A working committee including fintech industry experts was formed by ONDC in June to design a methodology for the integration and onboarding of sellers and industry participants. Later, in August of this year, ONDC launched its first fintech products in collaboration with Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, and other companies. In collaboration with online trading and investment platform Appreciate and asset management company (AMC) Nippon India Mutual Fund, the platform also saw its maiden mutual fund transaction in October.
Google Maps has announced that, from March 1, 2025, Indian developers will get “free” access to its suite of tools for up to $6,800 (more than INR 5.7 lakh) each month, in response to increasing competition from regional geotech companies. Tina Weyand, Google Maps’ senior director of product management, stated in a blog post that local developers will get “free” access to the company’s products, including software development kits (SDKs) and environment application programming interfaces (APIs), up to the specified monthly cap.
Google Maps’ existing fixed $200 monthly credit will be replaced by a newly announced pay structure. Developers will be able to create more for free after March 1, 2025, when they will have one month’s worth of free access to all of Google’s products, including the Maps, Routes, Places, and Environment APIs and SDKs. According to Weyand, this implies that developers in India would soon have access to up to $6,800 in free usage per month, spread across all products, in place of the company’s current fixed $200 monthly credit.
Unlimited Free Usage For Maps Embed API and Maps SDK
Maps Embed API and Maps SDK will continue to offer “unlimited free usage,” according to tech giant Google. Additionally, the updated pricing plans will allow developers to develop more effective solutions and experiment with the APIs and SDKs. It is anticipated that this approach will help Google better compete with regional firms like MapmyIndia and Ola’s Krutrim, particularly in terms of pricing, and will attract smaller developers. This comes after Google reduced the cost of its Maps platform in July of this year and introduced new pricing for Indian developers that is specifically altered for India. A partnership with Open Network for Digital Commerce (ONDC) was then revealed by the giant tech company, which will provide developers creating apps on the state-backed network with up to 90% off on specific Google Maps APIs.
Google Forming New Strategies to Remain Ahead in the Race
Google’s cost-cutting action followed Bhavish Aggarwal, the founder and CEO of Ola Consumer, urging Indian developers to abandon Google Maps. Aggarwal announced at the time that all developers on the Krutrim platform would have free access to Ola Maps for a year and that developers would receive more than INR 100 Cr in free credits. In the meantime, MapmyIndia has also been putting up a strong fight against Google Maps.
Google Maps launched a number of India-specific features earlier this year, such as flyovers, narrow road callouts, and Address Descriptors, which allow users to accurately pinpoint a location inside intricate city road networks. Google has launched Gemini AI in Docs, which is a related development. Compared to competing AI models, it can more clearly generate photo-realistic images of people, landscapes, and animals with only text cues. Gemini AI may be effectively used by users to upload full-bleed photos that fill a document’s page. Additionally, it can be used to produce inline visuals for promotional flyers, marketing campaign briefs, and digital restaurant menus.
EaseMyTrip, an Indian travel technology company, has introduced ScanMyTrip.com, which is India’s first marketplace that is integrated into the network of the Indian Government Open Network for Digital Commerce (ONDC).
As a result of this introduction, EaseMyTrip has also established itself as the first online travel agency (OTA) to sell as well as buy travel services through the ONDC platform. In the travel and tourist industry, the integration is anticipated to bring about a revolutionary change in how businesses interact with their clients. The possibility of even smaller service providers’ access to a larger audience will now be available to them, enhancing their ability to compete in the digital market.
With the launch of this new endeavor, EaseMyTrip demonstrates its commitment to promoting broad development and encouraging digital innovation within the tourist industry. This will make it simpler for businesses of all sizes to thrive within the ecosystem of eCommerce.
Rikant Pittie, the co-founder of EaseMyTrip, expressed that the company is very pleased about the prospect of developing India’s first technology, which will bring the company one step closer to resolving basic difficulties faced by thousands of travel service providers.
Why Did It Opt for the ONDC Network?
According to EaseMyTrip, the integration with ONDC will make it possible for enterprises in the travel and tourist industry to take advantage of ONDC’s digital infrastructure. This will enable even the most modest service providers to access a large consumer base.
According to the official statement shared by the company, ScanMyTrip.com streamlines the onboarding process, which in turn makes it simpler for businesses to connect with travelers and compete in the online marketplace.
The Chief Executive Officer and Managing Director of ONDC, Thampy Koshy, brought attention to the significance of this cooperation by stating that the incorporation of EaseMyTrip into the ONDC network is a significant turning point in their efforts to establish a travel ecosystem that is more approachable and open to transparency. This integration will not only increase opportunities for micro, small, and medium-sized enterprises (MSMEs) and homestays, but it will also develop a marketplace that is both competitive and equitable. On the other hand, it is entirely in line with ONDC’s aim of making travel and online shopping accessible to everyone.
Letter of Intent With ONDC
EaseMyTrip made a public declaration of its intention to participate in the digital change that ONDC is pushing inside the ecommerce market by signing a Letter of Intent with ONDC at the “ONDC Startup Mahotsav” earlier this year. In the press release, it was stated that this collaboration exemplifies EaseMyTrip’s commitment to fostering inclusive growth and providing cutting-edge digital solutions to the travel and tourism industry.
Saarthi is a reference application that was developed by the Open Network for Digital Commerce (ONDC) to assist businesses in the process of developing their buyer-side applications that are highly customized.
The artificial intelligence-driven language translation tool known as Saarthi was developed in collaboration with Bhashini. In addition to providing members in the network with a comprehensive architecture that enables smooth integration with ONDC, it also delivers expanded multilingual capabilities for a digital commerce experience that is more accessible.
Developing Software That Supports Multiple Languages
Saarthi is a reference tool that assists network members in the process of developing buyer applications that have multilingual capabilities. The programme initially supports five languages, including Hindi, English, Marathi, Bangla, and Tamil.
According to Bhashini’s objectives, the application will eventually be able to support all 22 languages. Consequently, this means that businesses are able to provide customers with a buying experience that is both personalised and localised, removing barriers related to language and increasing accessibility for people all throughout India.
What is Bhashini?
The objective of the “Digital India BHASHINI” initiative is to facilitate the creation of content in Indian languages, as well as to enable easy access to the internet and digital services in Indian languages, including access obtained through speech. It was put into operation at Gandhinagar, Gujarat, during the month of August 2022. Bhasha Interface for India is what Bashini is an abbreviation for.
In order to provide digital access and digital empowerment in an Aatmanirbhar Bharat, it makes use of natural language technologies to enable a diversified ecosystem filled with contributors, collaborating entities, and citizens. This is done with the intention of overcoming language barriers.
Features of Saarthi
Saarthi’s multilingual features, which include real-time translation, transliteration, and speech recognition, make it possible for enterprises to broaden their market reach. This, in turn, enables them to enter new regions and improve the number of customers they acquire.
It is important to note that the user-friendly and region-specific experience can also result in increased conversion rates and decreased support costs, which in turn can streamline operations and increase income.
In addition to this, the Saarthi application was developed with the goal of achieving scalability and simplicity of integration.
Views of the Partners
According to T Koshy, the Managing Director and Chief Executive Officer of ONDC, the introduction of Saarthi is a significant step forward in their journey towards a digital commerce landscape that is more inclusive. Through the provision of a reference application that enables businesses to develop buyer applications in several languages, the team is succeeding in removing obstacles caused by language and opening up new opportunities for engagement and expansion. The ONDC is committed to democratising access to eCommerce, and this programme coincides with that goal. It ensures that businesses of all sizes can engage with customers throughout India’s varied linguistic spectrum.
The fact that Bhashini is working with ONDC on Saarthi, according to Amitabh Nag, the Bhashini’s Chief Executive Officer, demonstrates the company’s commitment to addressing linguistic barriers in the realm of digital commerce. The objective of Bhashini is to accomplish the goal of making multilingual voice communication a universal medium, thereby breaking down language barriers in a variety of sectors beyond text and graphics. This cutting-edge language technology was developed by the company with the intention of enabling businesses to develop applications that accurately reflect the vast linguistic diversity that exists in India. By working together, the company is not only increasing the accessibility of online shopping but also establishing a new benchmark for inclusiveness in the digital marketplace.
Next two months, the open-source aggregator platform known as the Open Network for Digital Commerce (ONDC) will be launching insurance and mutual fund products. They will also be partnering with MasterCard for credit card processing.
Customers with and without salaries will be able to get unsecured credit through ONDC’s six-minute digital loans.
According to T Koshy, CEO of ONDC, “We have deployed a Marine app, one insurer and two more are coming.” “Even with health insurance, we’re in the game, but our partner isn’t licensed. The vehicle insurance is expected to be finalised within the following month. Plus, MF is scheduled to launch next month. We aim to complete 100-200 transactions before anything else,” he added further.
Although a debut date has not been announced, the aggregator platform is also planning to add credit card functionality to its existing range of services.
Loan in 6 Minutes
Accessible in as little as six minutes, ONDC’s new digital and paperless loans were launched on Thursday. Three lenders and nine buyer apps (often called LSPs) are part of the new offering.
Zyapaar, Indipe, Paynearby, Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, and Indipe are among the buyer applications. Karnataka Bank, Aditya Birla Finance, and DMI Finance are among the lenders.
Economic Survey 2024
Since its launch in 2022, the number of transactions on the ONDC has soared above 68 million, according to the Economic Survey 2024. The number of transactions increased by 12% month-on-month to 9.95 million as of June 2024. According to Koshy, 12 million transactions were processed by ONDC in July.
To further emphasise that the ONDC network democratises access for all merchants and “prevents market concentration,” Koshy chimed in. He went on to say that the network ensures that every customer can receive the lowest price on any product or service.
According to Koshy, small businesses eventually go out of business because platforms favour big suppliers and customers. This phenomenon is known as the network effect.
About ONDC
Open Network for Digital Commerce (ONDC), a Section 8 company, was established on the 31st of December 2021. It is an initiative of the Department for Promotion of Industry and Internal Trade (DPIIT), which is part of the Ministry of Commerce and Industry of the Government of India. The objective of this initiative is to develop a facilitative model that revolutionises digital commerce and increase the penetration of retail eCommerce in India.
A step towards the democratisation of digital commerce, ONDC symbolises a shift away from a platform-centric model, in which a small number of eCommerce companies control the industry, and towards an open, interoperable platform in which buyers and sellers can connect regardless of the platforms they are using. It is intended to move eCommerce away from walled gardens, which are ecosystems that are closed, compartmentalised, and highly stratified, and towards an environment that is more accessible and encourages competition, inclusivity, and innovation for businesses.
The ONDC (Open Network for Digital Commerce) Network, which is supported by the Indian government, now includes VAMA.app, a virtual platform that is changing the conventional offline Mandir ecology into a digital arena.
By doing so, VAMA intends to broaden the scope of its app’s spiritual offerings, making them more accessible to a more extensive pool of users.
Among the significant organizations that fall under the area of spiritual technology on the ONDC Network, VAMA.app is now included alongside the likes of ISKCON and Hari Bol.
Plans to Cater to a Vast Audience Through This Partnership
The Co-founder of VAMA.app, Manu Jain, made the following statement: “Our onboarding onto the ONDC Network symbolises our profound commitment to enriching spirituality and delivering transformative content directly to the hearts of our users.” With the broad reach that ONDC possesses, we are now able to welcome a large audience that is eager to cultivate a more profound connection with their spirituality. Because of this project, unprecedented access to spiritual counsel and live events will be made available to us, which will allow us to give a spiritual journey that is both more immersive and more profound.
T. Koshy, the Managing Director and Chief Executive Officer of ONDC, emphasized the significance of the inclusion of VAMA.app in the network by stating, “The addition of VAMA.app onto the Network has demonstrated our open-for-all approach.” Our ultimate goal is to become a one-stop shop for all of the users’ day-to-day needs, making it possible for them to obtain services that cover everything from commercial to spiritual demands.
The incorporation of spiritual services not only allows us to broaden the scope of our offerings but also helps to preserve and promote India’s cultural heritage in this age of digital technology. The availability of the VAMA.app on the ONDC Network would make it possible for devotees to connect with their faith seamlessly, overcoming both geographical geographical borders and time constraints. “This exemplifies our commitment to creating a digital marketplace that is truly inclusive and that caters to every aspect of Indian life,” Koshy added.
Details of Expansion
VAMA.app intends to provide services such as virtual pujas, temple darshans, rituals, and astrology to a more widespread customer base by utilizing the large network that ONDC possesses.
In addition to enticing new customers who are interested in digital spiritual solutions, the migration is intended to make things more convenient for those who are already using the service.
The firm was founded in the latter half of the year 2020 by Aacharya Dev, Himanshu Semwal, and Manu Jain. It asserts that it has partnerships with more than 250 temples and that it has a network of more than 300 astrologers.
In the next 2-3 years, the government-led Open Network for Digital Commerce is likely to start peaking and will likely “head to great success,” said Aakash Guglani, Manager at the Digital India Foundation.
Guglani, who works at the Digital India Foundation, a not-for-profit organisation that aims at digital inclusion in India, expects local vendors and small businesses to get empowered once traffic on ONDC increases.
Guglani also called out the unfair and highly-priced commissions being charged by private retail aggregators, saying ONDC will make transactions more transparent.
“So ONDC’s aim is to get to: how do you bridge from 180–200 million (online shoppers) to, let’s say, 500 million, and not by prohibitive kinds of marketplaces that do it by 20–25% payment of commission, but let’s say less than 10%, less than 5% kind of commission space so that a local vendor can get onboarded? So that’s the larger kind of structure (of ONDC),” he said.
Here are excerpts fromGuglani’s interview with StartupTalky.
StartupTalky: There was a lot of excitement and a lot of buzz. And given that the greatest minds were behind ONDC, coming from the UPI background, are you satisfied with the way you know ONDC has proceeded so far?
Guglani: Yes, it has, and I think because the success of UPI was such an important part of ONDC’s formulation itself, we are happy to be accepted by the stakeholders. Most people, most payment aggregators, and most banks are on it. We do see some sort of consumer demand coming up on ONDC. So that’s a good sign for the larger success of this kind of network system. And let’s say we call it the digital public infrastructure. We already have Aadhar and UPI, and now we have ONDC. As we have ONDC, we will also build some sort of credit system over it. Yes, we are satisfied, but there are obviously a lot of things to do.
UPI was an easier thing to do because the information collateral was very limited; you just needed three or four types of information criteria. You need payment person 1, payment person B, an intermediate bank, and the overall architecture. In ONDC, you need a little bit more complications; you need to have order deliveries, returns, and grievance redressals. So it’s a little bit complicated to come in. That’s why it’s a little bit complicated; it will take time.
Remember, in UPI 2016–2017/18, there was not much uptick. But after 2019–20, you saw such a massive uptick that you saw 11 crore transactions daily. So right now, too, ONDC sees 40,000 transactions daily. So that it will peak in 2–3 years. So any good product development takes three, four, or, let’s say, some sort of consolidation to happen. So I think it’s an early growth stage, but we are hoping for great success.
StartupTalky: There’s huge potential for ONDC to reach out to a particular set of people. For this, what factors or impediments need to be ironed out?
Guglani:First of all, some numbers: we have 360 million unique users of UPI. As per some consulting reports, we have people who shop online who are like 180–190 million. And so we have this gap, let’s say, reaching 320 million.
Let’s say the UPI numbers we believe in are already going up and up and up. So if they penetrated to a level of 500 million users, you would have this growth path from 180 million to 500 million. And 180 million is totally private-led. We have big e-commerce platforms, but they could not penetrate. So let’s say the penetration rate of e-commerce is 7-8%. And in the US, in China, you have 20–30% penetration. We know in India that is not working because offline retail still works a lot. So UPI broke that kind of phenomenon because digital market infrastructure is at zero cost.
Because India is a unique society, the price differential is different. You needed some sort of public infrastructure digital technology—let’s say, intervention. So ONDC aims to get to – how do you bridge from 180-200 million to, let’s say, 500 million, and not by prohibitive kinds of marketplaces that do it by 20–25% payment of commission, but let’s say less than 10%, less than 5% kind of commission space so that a local vendor can get onboarded. So that’s the larger kind of structure.
There might be problems here. We have to understand why private platforms and marketplaces could not go to, let’s say to major kinds of spaces. Is it the structural reasons or is it the availability of tech? Let’s say the internet was the issue or penetration. Internet penetration is 47%. If it increases to 60%, will that help? So that was the larger context setting for ONDC. If we’re able to do these things well like what you did with UPI, that there is a market ecosystem coming up, private players, and there’s also let’s say, people’s participation.
Let’s say a chaiwala or a vegetable vendor is using UPI. Will they similarly use ONDC? Our hypothesis is yes if you make it easily comprehensible. That’s why you will not build the UI for it, you will build the network, like you did with UPI. Google Pay comes in, you have Autobank or any bank that can come up. Same way, in ONDC we are building the architecture. Let’s say a new opportunity for a startup, you can start your buyer application, or let’s say you can start your own logistics app. So if the stakeholder and the market ecosystem come I think will be successful to go to that 500 million like UPI did. And we are also ensuring how we can build a grievance redressal mechanism, the returns mechanism. That’s a complicated story. It’s difficult to do, but we are ready.
I think the system, the way it is aligned, the people who are leading it, I think we have ecosystem builders like the traditional FMCG company, people who are on the board of directors of ONDC. You have technologists, you have people who have done investment deals, you have the people from let’s say SIDBI, you have people from different banks. So you have that kind of stakeholder design by initiation. That could help because policies are there, and the government is supporting them. And I think we just need the market to get deepened and ONDC can fit in.
For the full video of the conversation, you can watch it below:
Digital India Foundation Manager Aakash Guglani on ONDC Potential, Unfair E-Marketplace Commissions
The Indian government’s initiative to make eCommerce accessible to every pin code in the country has resulted in the Open Network for Digital Commerce. Since then, ONDC has been touted as the next UPI (Unified Payments Interface) for eCommerce transactions. A one-stop online shopping web for buyers and sellers to transact with complete price transparency. It has rightly created the buzz to take eCommerce to the next level in India.
Already, ONDC is showing signs of buzzing activity. In the festive week leading up to Diwali, ONDC recorded almost 1.2 million transactions across 600 cities! In November itself, transaction value spiked to 4.7 million.
The big question, however, is whether ONDC will have enough muscle power to replace the shopping experience on huge aggregator platforms such as Amazon and Flipkart.
ONDC has only taken baby steps, experts opine.
“ONDC is in its early growth stage. But we are hopeful that it will start peaking in the next 2–3 years,” said Aashish Guglani, senior policy associate at the Digital India Foundation.
In this article, we take a closer look at how ONDC is expected to transform the shopping experience and what room for improvement some participants see within the ONDC universe.
From the word go, ONDC’s potential has been promising, given the sharp rise in online transactions by Indians.
The open network protocol is expected to act as a force multiplier for various segments—businesses, consumers, application developers, governments, and other relevant participants—through the creation of an interoperable and open playground for various sections to function and compete, ONDC said in a note when it announced the launch.
According to ONDC, India has the third-largest online shopping market, with 14 crore eRetail shoppers in 2020. Despite the large base, the eRetail penetration level is only 4.3%, compared with 25% in China and 26% in South Korea. This goes to show the untapped potential for eCommerce in India.
The COVID-19 pandemic forced people to shop online. Slowly but surely, Indian shoppers have now started digging their heels into the online shopping experience. The sudden boom in UPI payments only made shopping a seamless experience.
ONDC is trying to replicate the UPI experience in the eCommerce space by offering a more transparent framework.
McKinsey expects India’s digital commerce with ONDC to surge five times to around $340 billion by 2030.
With aggregator platforms reportedly charging commissions of 23-25%, ONDC does look attractive as of now. According to media reports, ONDC could start charging a small fee from participating platforms going forward in the range of 2–3%. As of now, seller network participants on the ONDC network may charge a marginal fee to the buyer. Even with these charges, the buyer has the choice to pick a seller based on their pricing points.
Number of Digital Buyers in India in 2021, With Estimates Until 2025
ONDC Network
ONDC offers a network for buyers and sellers. Consider it to be a digital land parcel hosting a township of malls, where buyers and sellers meet and transact their goods and services. As of now, some of the sellers on the platform range from food delivery apps to retail giants, small retail stores, and electronic stores, among others.
When it comes to the ONDC platform, the more, the merrier. The higher the number of participants, the greater the price discovery. As of now, ONDC hinges on buyers’ and sellers’ apps to route customers onto the network.
Buyer Apps/Seller Apps: For example, Paytm, Mystore, Craftsvilla, and Yatri are some of the buyer applications that allow customers to access the ONDC network through their respective apps. Similarly, there are seller-side apps that allow the onboarding of customers, including Magicpin, Bitsila, Growth Falcons, uEngage, and Mystore.
Gateways: Gateways are applications that aid the discoverability of goods and services for the buyer based on his or her search request and location.
Retail Boom
As of now, a chunk of Indian shoppers prefer to buy products from offline outlets. The Kirana store, infamously termed a ‘mom-and-pop’ store, forms 80% of India’s retail sector. Getting smaller retailers onboard the ONDC network is vital for its success.
Realizing the massive potential of ONDC, retail giants are doing their bit to onboard smaller retail outlets. India’s largest retailer, Hindustan Unilever, reportedly plans to help onboard around 1.3 million Kirana stores, which directly purchase from the giant.
Meanwhile, some companies from other sectors, such as electronics, are in a wait-and-watch mode.
We will get onboarded when we see a large part of our customers themselves upgrading and taking up this platform. As of now, we are just waiting and watching how this pans out. It seems promising on paper, but let’s see how it gets picked up in our industry, said Ujjwal Sarin, founder of audio electronics company Nu Republic.
Increased traffic on the ONDC platform holds the key for participants to reach a fair price discovery. Placeorder.com founder and CEO Thomson Skariah says it’s important for businesses to be available on the ONDC network to begin with.
“It’s about businesses being available on the network to receive orders. You need to make sure that you know this is one more revenue channel for you,” Skariah said.
Digital India’s Guglani says, “If the stakeholder and the market ecosystem come in, ONDC will be able to reach $500 million as UPI did.”
In June of this year, ONDC launched the B2B trade on its platform, which allowed merchants to transact with other businesses and undertake wholesale transactions. This is likely to be a game-changer for businesses going forward.
With the launch of B2B on ONDC, brands can establish connections with retailers or facilitate their distributors’ entry into new markets. With “plug and play” capabilities (such as real-time ordering, swift delivery, and credit management) offered by eco-system participants, ONDC will enhance the experience for both brands and retailers, said Sathish Gopalaiah, President, Consulting, Deloitte South Asia, in a press release.
“Retailers (such as grocery stores and pharmacies) could access a wider distribution network, saving time and costs. Direct linkages between retailers and manufacturers would be likely to cut prices, improving margins in sectors such as agriculture and construction,” said a McKinsey report.
Some experts hope that the network could also provide the elusive answer to questions about access to credit. The Open Credit Enablement Network, like the ONDC, is part of the India Stack of digital infrastructure envisaged by the government of India.
“Right now, with open credit, because everything will be catalogued, you are digitized. I would like to know what kind of sale you have in a month; we would have that kind of information collateral. Therefore, it becomes easier, cheaper, and less risky for a bank to give you a loan,” Guglani said.
Room for Improvement
Although the advantages seem to outweigh the risks at the moment for ONDC, the scope for improvement has nevertheless been expressed by experts.
Customer Service
The Digital India Foundation has named three key risks to ONDC, namely: access and ownership of data, customer service, and evolving roles and responsibilities. It has pegged the risk of the absence of clarity over customer service at 74%.
“Most of those associated with ONDC claimed to have faced no problem while onboarding, though few wished the process could be faster and the customer care segment more responsive,” said a survey released by Shiprocket on ONDC in August.
Data Privacy
Data privacy is also a concern shared by a few participants. At the very outset, ONDC has made it clear that it will not be storing or viewing any transaction data. Despite these assurances, data phishing continues to remain a risk.
“The government and ONDC are facilitating e-commerce. But, with so many people handling online transactions, their data could be misused by people with technical knowledge,” said Dr. Himanshu Talwar, executive board member of the Young Leaders Council (YLC) Executive Board Member – Young Leaders Council, under the All India Management Association.
User Experience
ONDC will have to put up an experience that remains on par with, if not exceeds, global standards.
“ONDC’s main challenge is to match the platform’s technological viability with the increasing number of transactions and clients. It needs to compete with some of the finest apps in the world, like Amazon, Flipkart, and Uber. There’s growing pressure on ONDC to keep up with the latest mobile apps and meet customer demand,” said the International Journal of Engineering & Technology in its research note.
Conclusion
Like any digital innovation, ONDC too may overcome its initial technical hiccups and upgrade with better versions going ahead. Going by the steady rise in the number of transactions on the platform, it’s only a matter of time before ONDC can become the big disruptor in India’s gargantuan eCommerce space.
Nitin Konde
