Open Network Digital Commerce (ONDC) plans to begin operations in August and launch a pilot program the following month. The network will not only provide purchasers with a platform for retail but also food delivery, tourism and hospitality, travel, mobility, and wholesale commerce.
It will not only be B2C (business to consumer) but also B2B (business to business) (business to business). PhonePe, Paytm, Dunzo, sellerapp, Microsoft, Tally, Gofrugal, FarEye, GrowthFalcons, eSamudaay, goodbox, and the Federation of All Indian IT Associates are currently integrating with ONDC. You might be wondering, what is ONDC, and what is it all about? So, before getting into the technicalities, let’s know what ONDC is?
What Is ONDC?
It is a neutral platform that will offer open-source protocols for cataloging, vendor matching, and price discovery, akin to the Unified Payments Interface, in order to provide equal opportunities to all marketplace participants, including consumers (UPI).
Aim: To encourage open networks for all elements of commodities and services to exchange through digital or electronic networks.
Consumers and sellers can do business whether or not they are linked with a specific e-commerce platform.
The initiative is being presented to break up the dominance of platforms such as Flipkart and Amazon.
Functioning Of ONDC:
· ONDC will be in compliance with the Information Technology Act, 2000.
· It is designed for compliance with the emerging personal data protection bill.
Significance Of ONDC:
· ONDC plans to automate the whole value chain, standardize operations, enhance logistical efficiency, and boost customer value.
· When the ONDC is wholly deployed, all Indian e-commerce businesses will be compelled to adhere to the same protocols as Android-based mobile devices.
· Discoverability, interoperability, and inclusiveness would be introduced, benefiting both smaller online retailers and new entrants.
· Eliminating the monopoly of large platforms in areas like retail, food, and mobility would empower suppliers and customers.
Benefits Of Having ONDC:
The Open Network for Digital Commerce (ONDC) is an open protocol-based project of the Ministry of Commerce and Industry’s Department for Promotion of Industry and Internal Trade (DPIIT). It will make buyers and sellers visible and transactable across mobility, shopping, restaurant order, delivery, hotel booking, and travel. The platform intends to provide new options for micro, small, and medium-sized businesses.
Due to their poor financials and massive financial muscle, significant corporations have nearly monopolized the e-commerce market. Small businesses do not have an equal opportunity to participate in e-commerce.
The platform will allow new start-ups to build a network of vendors, give service to local regions, and enhance competition. For example, you can Google any information and get a slew of possibilities; similarly, it (ONDC) will be simple for someone who wants to buy goods to receive a slew of options.
How Will ONDC Function?
· The Centre has established a thorough method for the operation of the open network, with the primary goal of protecting the security and privacy of data in the network.
· It must not compel participants to provide any transaction-level data with ONDC. It shall collaborate with them to publish anonymized aggregate metrics on network performance without jeopardizing confidentiality and privacy.
· ONDC will be following the Information Technology Act of 2000 and developed by the upcoming Personal Data Protection Bill.
· The Government also intends to establish independent e-commerce regulating institution similar to Sebi.
Wrapping Up:
Once the ONDC is deployed and regulated, which is planned by August 2022, all e-commerce enterprises in India, regardless of brand, would be required to use the same practices as Android-based mobile devices. This would benefit both smaller online shops and new entrants by increasing discoverability, interoperability, and inclusiveness. It will empower suppliers and customers by breaking the monopoly of large platforms in order to stimulate innovation and alter companies in industries such as retail, food, and mobility.