Large players, including Amazon and Flipkart, may soon plug into Open Network for Digital Commerce (ONDC), DPIIT secretary Anurag Jain said on Friday.
E-commerce majors Amazon and Flipkart currently account for the lion’s share of the market in the country.
“We have initiated conversations with all of them and initial indications are that they will join. The conversations with the top four are in various stages, and by and large they seem interested,” Jain said.
Also Read: ONDC to democratise e-commerce in India: Report
To further enhance the efficiency of settlements on the network, ONDC has developed a framework to support reconciliation and settlements, ensuring payments are correctly distributed to the right entities as defined in the digital contracts and service-level agreements within defined timeframes.
The system is expected to go live by January 2023 and has been tested successfully and implemented by Kotak Mahindra Bank and Protean. Meanwhile, the integration of Bharat Bill Pay System (BBPS) with the ONDC ecosystem is in advanced stages of development.
According to DPIIT additional secretary Anil Agrawal, the ONDC is expected to reach a critical mass over the next two years. However, he ruled out any incentivisations or subsidies from the government to onboard any entities.
Also Read: Delhivery goes live on ONDC to expand reach
Currently, the e-commerce penetration in the country is roughly 5-7%, Jain said, pointing out that a large number of sellers and buyers remained outside of the online ecosystem.
“The ONDC is now being tested across 85 cities with plans to increase its reach to smaller towns and onboard local kiranas and merchants,” ONDC managing director and chief executive officer T Koshy said.
ONDC is also undertaking several new initiatives among which a one-time incentive programme was rolled out starting Thursday. “Through this one-time incentive programme, the aim is to scale our current network of 700 plus merchants across India in F&B and groceries to more than 20,000 merchants across various categories,” Koshy said.
ONDC is a government-backed digital network that will facilitate small merchants and mom-and-pop stores across the country to access customers. The objective is to create an interoperable network for digital commerce similar to the UPI — Unified Payment Interface — network for payments.
Though a nascent initiative, its successful and full-scale execution could provide a fillip to the Indian e-retail ecosystem. Among the companies that have signed up are Shiprocket, Ekart, Kotak Mahindra Bank and Snapdeal.
NPCI (National Payments Corporation of India) is a shareholder in ONDC together with a host of banks, NSDL, CDSL, NSE, BSE, Nabard and Sidbi.
Since September, multiple other buyers, seller and logistics applications have gone live, with ITC, EkSecond Technologies, Meesho, Uengage, Grab, Delhivery, Shiprocket and others, and over 70 participants are in advanced stages of integration.