ONDC hits a fresh peak of 5 million retail-category orders in May

In terms of total volume, including the retail and ride-hailing segments, the network saw a 23 percent month-on-month increase to 8.9 million transactions in May

The Open Network for Digital Commerce (ONDC) hit a fresh peak of 5 million retail orders in May, compared to 3.59 million in the previous month. The government-backed network also saw an all-time high of 200,000 retail transactions in a single day during the month, according to people close to the developments.

ONDC transactions are broadly classified into two categories  — ride hailing and retail (including food, grocery, fashion and electronics).

In May, the interoperable network saw two segments in the retail category — food delivery and grocery — each hitting one million orders for the first time ever.

However, the food segment accounted for only 20 percent of the total retail orders in May. This share was at 76 percent a year back — when food delivery orders accounted for 210,000 of the total 270,000 retail transactions.

There has been a significant change in the makeup of ONDC’s retail category transactions over the past few months as the share of food delivery orders has been consistently falling, while other categories such as grocery, fashion, home and kitchen have seen an uptick.

Last month, grocery accounted for one million orders, 630,000 orders, home and kitchen for 330,000 orders and other retail sub-categories added up to two million orders.

“This impressive growth is driven by higher penetration across most major domains and the rapid scale-up of on-network logistics, facilitated by prominent participants like Ola Mobility, Pidge, and Loadshare… This surge in orders is particularly noteworthy given the continuous calibration of marketing interventions by ONDC,” said a source close to the developments.

In terms of total volume, including the retail and ride-hailing segments, the network saw a 23 percent month-on-month increase to 8.9 million transactions in May.

The ride-hailing segment has seen a slower growth — from 3.6 million trips in April to 3.8 million trips in May. This is still lower than its peak of 4 million trips in March.

“The mobility domain, despite facing a challenging operating environment, posted mid-to-single-digit growth. This resilience is notable, especially as major off-network ride-hailing applications have transitioned to a subscription-based model, mirroring the on-network mobility applications,” said a source, pointing to the impact of ride-hailing companies like Uber and Ola piloting subscription models for drivers like ONDC-based Namma Yatri.

Delhi, Uttar Pradesh and Maharashtra remain the top three states in terms of on-network orders. Uttar Pradesh saw its order numbers nearly double, while Bihar reported a 42 percent growth.

ONDC is used by approximately 535,000 sellers in over 1,200 cities, with 84 percent of these being small sellers contributing to 56 percent of total on-network orders.

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.

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.