The volume of monthly retail purchases on the Open Network for Digital Commerce (ONDC) has grown six times in the last six months to hit 3.6 million in March, compared to over 600,000 in September last year, according to people close to the developments.
This has been driven by significant discounts for users, incentive schemes for sellers, the entry of big players like Boat, Domino's, McDonald's, and the network's expansion to more cities.
Meanwhile, the total number of transactions on the network in March reached 7.7 million, which includes 4.1 million ride-hailing bookings on the Namma Yatri app. In contrast to retail purchases, monthly ride-hailing has grown only 1.5 times in the last six months — from 2.7 million in September.
ONDC declined to comment on the transaction numbers.
The large share of retail purchases in the total monthly transactions stands in stark contrast to early 2023, when it accounted for only 5-10 percent, with the mobility category dominating with 90-95 percent of all transactions.
In February, ONDC came up with a fresh incentive structure to reward its constituent e-commerce platforms not just on the basis of retail purchase volumes, but also on the rate of order growth as the government-backed network seeks to grow daily transactions by 10 times over the next one year.
Earlier, buyer side platforms on the network would get an incentive per order on the basis of the total volume of transactions during the past week. Now, ONDC has introduced a growth ‘multiplier’ on top — which means a platform can get more money on the basis of their week-on-week rate of growth.
Over the past year-and-a-half, multiple new-age companies such as Paytm, Ola, PhonePe, Meesho, Magicpin and Shiprocket have taken to ONDC, aimed at breaking the stranglehold of a few players such as Amazon, Flipkart, Zomato and Swiggy on online retail in the country.
Sources said over 370,000 sellers and service providers, from top brands to farmers and taxi drivers are now on the network.
ONDC is operational in 588 “countable cities”, which are the cities or districts with more than 100 orders a month in the last 3 months. This is approximately 70 percent of cities in India. The platform has fulfilled transactions in over 800 cities in India.
Ride-hailing through ONDC is now live in seven cities: Bengaluru, Mysuru, Kolkata, Hyderabad, Delhi, Chennai and Kochi. The launch of metro ticket booking on ONDC in Chennai is being seen as a crucial step towards multimodal mobility through the network.
Expanding the offerings
In January, ONDC successfully tested a couple of transactions for personal loans with Easypay and DMI Finance. 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 — credit, insurance and wealth management.
Its online dashboard shows that financial services players such as 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.
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