In January, ONDC racked up 100,000 retail purchases every day on average

For comparison, the number of retail purchases on ONDC in January 2023 was around 1,281

For the first time, Open Network for Digital Commerce (ONDC) crossed 3 million retail purchases in a month in January which means an average of over 100,000 such transactions per day, according to people aware of the developments.

In the third week of January, Moneycontrol had reported that the government-backed network had seen six days on the trot when daily retail purchases topped 1 lakh. Sources now say that there was a period of at least 16 consecutive days during the month when this number was breached on a daily basis.

For comparison, the number of retail purchases on ONDC in January 2023 was around 1,281.

Further, ONDC clocked 3.5 million mobility (ride-hailing) bookings during the month, taking the network's total transactions across categories to over 6.5 million in January. This shows a month-on-month growth of 18 percent, compared to the 5.5 million transactions seen by the network in December.

Of the 5.5 million transactions made via ONDC in December, 2.1 million were in the retail category, while 3.4 million were in the mobility category.

The current share of retail purchases in the total monthly transactions stands in stark contrast to early 2023, when retail accounted for only 5-10 percent, while the mobility category dominated with 90-95 percent of all ONDC transactions.

ONDC declined to comment on the transaction numbers.

While 2023 focused on laying the groundwork for ONDC by onboarding a substantial initial wave of buyers, sellers, and platforms, 2024 will be a crucial year in determining its scalability.

To this end, sources said that the government-backed network plans to achieve a monthly run rate of up to 8 million transactions by the end of FY24. At its current pace of growth, the goal is likely to be met.

Over the past year and a half, multiple new-age companies such as Paytm, Ola, PhonePe, Meesho, Magicpin and Shiprocket, have taken a bet on the government-backed ONDC that is aimed at breaking the stranglehold of a few players like Amazon, Flipkart, Zomato and Swiggy on online retail in the country.

On the other hand, traditional FMCG majors like Unilever and ITC have also thrown their hats in the ring as ONDC presents them an opportunity to sell directly to consumers and save on significant distribution costs.

In December, Paytm founder and chief executive officer Vijay Shekhar Sharma said that ONDC will open up the e-commerce opportunity for a lot of players as it breaks down different parts of a transaction such as seller, logistics, and payment into separate parts. In effect, a single player doesn’t need large amounts of funding to build all the parts to break into the ecosystem.

Meanwhile, in the middle of January 2024, the network successfully tested a couple of transactions for personal loans with Easypay and DMI Finance. Further, with the technology being tested and optimised, other finserv participants are scheduled to go live over the next few weeks.

Within the financial services space, ONDC is building the infrastructure for three broad segments of products — credit, insurance and wealth management. Its online dashboard shows that financial services players like Aditya Birla Capital, Tata Capital, Canara Bank, Kotak Mahindra Bank, Bajaj Finserv, Bajaj Allianz, Aditya Birla Health, etc are in various stages of integration with the network.

With ONDC, the government hopes to increase e-commerce penetration in the country to 25 percent in the next couple of years, reaching a gross merchandise value of $48 billion.