The department for the promotion of industry and internal trade (DPIIT) in the ministry of commerce and industry is building an open network for digital commerce (ONDC), designed to curb digital monopolies and standardize the on-boarding of retailers on e-commerce sites.

The department for the promotion of industry and internal trade (DPIIT) in the ministry of commerce and industry is building an open network for digital commerce (ONDC), designed to curb digital monopolies and standardize the on-boarding of retailers on e-commerce sites.

What does the ONDC aim to achieve?

The Unified Payment Interface (UPI) has disrupted the digital payments domain. ONDC seeks to achieve something similar for e-commerce. It aims to “democratize" digital commerce, moving it away from platform-centric models like Amazon and Flipkart to an open network. ONDC may enable more sellers to be digitally visible. The transactions will be executed through an open network. According to people in the know, the system may empower merchants and consumers by breaking the silos that exist today. It will eventually touch every business, from retail goods and food to mobility.

How would ONDC work?

The network makes it easier for a small retailers to be discovered. Once a retailer lists its products or services using the ONDC’s open protocol, the business can be discovered by consumers on e-commerce platforms that follow the same protocol. A consumer searching for the product can see the location of the seller and opt to buy from the neighborhood shop that can deliver faster compared to an e-commerce company. This may promote hyperlocal delivery of goods such as groceries, directly from sellers to consumers.