ONDC - Changing Indian e-commerce the UPI way

8 October 2022

Open Network for Digital Commerce (ONDC) is a network based on a protocol which will enable local commerce across fields like mobility, grocery, food order and delivery, booking of hotel and traveling among others which are to be discovered and engaged with any network-enabled applications. The main aim is to create important opportunities, curb digital monopolies and aid the micro and small traders to engage in their small platforms. It is under the initiative of the Department for Promotion of Industry and Internal Trade (DPIIT)under the Ministry of Commerce and Industry. Dhanaay works to highlight the importance of such a platform and bring the significance to the notice of the masses. The salient features of ONDC can be understood from the list given below.

An UPI of e-commerce, ONDC seeks to democratize digital or electronic commerce by transforming it from a platform-based model to an open-network. With the help of such initiatives, merchants will be able to save their data and build a credit history to reach the consumers.
The government backed platform, aims to create a level field for e-commerce like Amazon, Flipkart and offline traders who were dissatisfied with the unfair practices of such entails. The platform also aims to be cooperative with the Information Technology Act of 2000 and designed in accordance with the emerging Personal Data Protection Bill.
It allows sellers and buyers to be digitally transparent through an open network which also allows merchants to be empowered and consumers to break silos, forming a network to drive innovation and scale while transforming all businesses from retail to mobility.
ONDC seeks to promote an open network which is developed on open-sourced methodology using various specifications and different network protocols independent of any specific platform. It expects to digitize the entire chain value, standardize the operations and promote inclusion of suppliers while driving efficiencies in logistics and enhancing value for customers. As per government’s official statement, ONDC would take all the measures to keep the confidentiality and privacy of data intact in the network. It will not share any transaction-level data by participants with ONDC and will work with its participants to anonymously publish aggregate metrics on network performance without compromising on the privacy factor. It uses free software methodology, open specifications and network protocols. The consumers and the merchants are able to transact goods and services independently of any platform. Beckn protocol provides the technology and specification layer on which it designs the network policies, trust and grievance, handling various reputation systems. It also plans to implement inventory management, optimize delivery cost to reduce the business cost. It will work on a hyper local search engine model based on GPS proximity data as a default setting. The buyer is allowed to independently select the seller and the logistics partner to finish the order. Various industries are raising concerns over the liability of network participants for consumers and the implementation of various rules of e-commerce on the stakeholders. There remains the added question of third party network policies. ONDC also tries to resolve the issues of network disruption and provide a reliable guarantee. It limits data usage which affects interoperability. It doesn’t believe in lessening customer’s price through shareholders money and instead focuses on innovative and value addition on products. The system aims to be robust and competitive. A third-party agency is set to handle the Online Dispute Resolution (ODR) by keeping a track of various individual orders. Customers are free to check complaint reports and the status of its handling. ONDC strictly records all the complaints which are filed against merchants on the basis of consumer consultation, who can later choose to take it to consumer courts. The dashboard publishes the monthly record of such complaints to keep the customers updated throughout. On 2nd September 2022, it also invited a public feedback on buyer seller complaints. It had a huge success rate as very recently, Flipkart, Amazon, Ekart and Dunzo started joining ONDC. Even Paytm and PhonePe came into conversation with the logistics, in an advanced stage of integration with ONDC. Later, Google shopping, Dabur, Nivea, Shopify also started showing legitimate interest on the platform and Shiprocket made the final stages of integration in the name of LNP. Further, products linked with Khadi and those initiated by Scheduled Tribes were also promoted in the platform for national level recognition. Thus, ONDC has became popular as a digital platform and with collaboration with multiple sectors, it is developing a great buyer-seller bond which will eventually lead to a huge level of success in the near future.