The ONDC platform or Open Network for Digital Commerce is a digital platform developed by the Government of India to enable interoperable digital commerce transactions. ONDC aims to provide a level playing field for all participants in the digital commerce ecosystem, including small and medium enterprises (SMEs), by reducing the entry barriers for them to participate in the digital economy.
In this article we will understand
- What is ONDC platform
- How Customers & Sellers will interact on ONDC
- How ONDC will change shop keepers’ life in India?
ONDC is being developed by the Ministry of Commerce and Industry, in collaboration with the Department of Telecommunications, the National Payments Corporation of India (NPCI), and the Indian Institute of Technology (IIT) Delhi. The platform is expected to be launched in the near future, and once operational, it will facilitate the seamless exchange of data and information between different stakeholders in the digital commerce ecosystem.
What is ONDC platform?
The ONDC platform is based on open architecture principles, which means that it will be accessible to all players in the digital commerce ecosystem, including merchants, payment service providers, logistics providers, and regulatory authorities. The platform will enable these players to access a common set of APIs (Application Programming Interfaces) to exchange data and information in real-time.
ONDC aims to provide a secure and transparent platform for digital commerce transactions, with robust security features built into the platform. The platform will also ensure compliance with all relevant regulations and laws governing digital commerce transactions in India.
ONDC will support multiple payment modes, including UPI (Unified Payments Interface), BharatQR, and credit and debit cards. This will enable merchants to accept payments from customers using their preferred mode of payment. The platform will also provide a range of value-added services, including credit and insurance, to help SMEs grow their businesses.
In a typical case of ONDC order placement: a buyer will place order for his/her own shoe from ONDC registered seller and it will be fulfilled by local shoe store to his/her location. This will allow local shops/kirana stores to take part in the commerce and increase revenue.
There would be 4 types of roles one can play:
- Connect Buyers to Network
In this one has to build a website, app, IVR system to get customers to registered ONDC seller.
- Connect Sellers to Network
This typically means an application where sellers can register and host their products or services
- ONDC gateways
This will help route the location, category etc type of buyers and sellers data to correct buyers/sellers.
- Technology enablers
This role will require someone to empower above mentioned roles with technical support and services
The following are some of the ways customers and sellers will interact on the ONDC platform:
- Registration: Sellers will be required to register on the ONDC platform to start selling their products and services. Customers, on the other hand, can browse through the various products and services available on the platform and make purchases.
- Product and Service Listings: Sellers can list their products and services on the ONDC platform, along with their prices, descriptions, and other relevant details. Customers can browse through these listings, compare prices, and choose the products or services they want to purchase.
- Payments: The ONDC platform will support multiple payment modes, including UPI (Unified Payments Interface), BharatQR, and credit and debit cards. Sellers can choose the payment modes they want to accept, and customers can make payments using their preferred mode.
- Order Management: Sellers can manage their orders and track their inventory levels on the ONDC platform. They can update the status of their orders, notify customers about shipping and delivery details, and handle returns and refunds.
- Customer Support: The ONDC platform will provide customer support features, including a dedicated helpdesk and chat support, to help customers with their queries and concerns.
The Open Network for Digital Commerce (ONDC) is expected to bring significant changes to the lives of shopkeepers in India, especially those who have been operating in traditional brick-and-mortar stores.
Here are some of the ways that the ONDC platform is likely to impact shopkeepers in India:
- Access to a wider customer base: One of the most significant benefits of the ONDC platform for shopkeepers is that it will enable them to reach a wider customer base. By listing their products and services on the platform, shopkeepers can expand their reach beyond their local area and tap into a larger market of potential customers.
- Lower entry barriers: The ONDC platform aims to reduce the entry barriers for small and medium enterprises (SMEs) to participate in the digital economy. This means that shopkeepers who may have previously been deterred by the cost of setting up an online store or the complexity of digital commerce transactions can now participate more easily.
- Reduced transaction costs: The ONDC platform will enable shopkeepers to offer their products and services at lower costs by reducing transaction fees associated with digital commerce transactions. This will help them to remain competitive in a rapidly evolving market.
- Improved efficiency: The ONDC platform will enable shopkeepers to manage their inventory, orders, and payments more efficiently, which can save time and resources. Shopkeepers can use the platform to automate processes such as order management, payment reconciliation, and inventory tracking, which can improve their overall business operations.
- Value-added services: The ONDC platform is expected to offer a range of value-added services, including credit and insurance, to help shopkeepers grow their businesses. These services can provide shopkeepers with access to financing, which can be challenging for small businesses, and help them to manage risks associated with their operations.
Let’s take the example of a saree shop to understand how the Open Network for Digital Commerce (ONDC) can benefit a traditional brick-and-mortar store.
- Increased visibility: By listing their sarees on the ONDC platform, the saree shop can increase their visibility to a wider audience beyond their local area. Customers from different parts of India and even abroad can browse through their saree collection and make purchases.
- Reduced transaction costs: The ONDC platform aims to reduce the transaction costs associated with digital commerce transactions. This means that the saree shop can offer their sarees at lower prices than what they would need to charge if they were to sell through other online marketplaces or channels.
- Efficient inventory management: The ONDC platform will enable the saree shop to manage their saree inventory more efficiently. They can update their inventory levels in real-time, ensuring that they don’t oversell or undersell any sarees. This can help them save time and resources, which can be used to focus on other aspects of their business.
- Streamlined order management: The ONDC platform will also enable the saree shop to manage their orders more efficiently. They can track the status of their orders in real-time, update customers about shipping and delivery details, and handle returns and refunds seamlessly. This can help them to provide a better customer experience and build customer loyalty.
- Focus on Innovation and Design: Saree owner can invest time and effort in studying demand pattern, involve more artist and do research on the products itself, in current scenario they are much more concerned over dead stock and seasonality of business.
- Access to value-added services: The ONDC platform is expected to offer value-added services, such as credit and insurance, to help SMEs grow their businesses. The saree shop can use these services to access financing, which can be challenging for small businesses, and manage risks associated with their operations.
Recent updates/activiites in ONDC platform:
Recently Meesho joined ONDC platform and they are planning to launch pilot project for Bangalore and soon to rest of India. Here is the full story click here
Know about Future Skills Prime another Govt Of India and MITY & NASSCOM joint venture, click here