An open technology network for small merchants is in the works, where traders and consumers can buy and sell everything. The man behind this freely accessible online system is India’s high-profile mogul Nandan Nilekani. The network has the potential to challenge big e-commerce giants Amazon and Walmart-owned Flipkart, which have captured 80 per cent of the country’s online retail market.
“It’s (Open Network for Digital Commerce) an idea whose time has come. We owe it to the millions of small sellers to show an easy way to participate in the new high-growth area of digital commerce,” Nilekani, who is the co-founder and non-executive chairman of Infosys, said recently. Previously, he has helped the government develop the Aadhaar biometric ID system.
Despite the challenges, Nilekani is the right man for the task, said Hemant Taneja, managing partner at Palo Alto-based venture capital firm General Catalyst, according to a Bloomberg report. “Nandan is known for his long game, for setting up systems for enduring change with very intentional thinking on which parts of the economy should be digital public goods and which parts capitalism-driven,” Taneja said.
Nilekani, the co-founder and non-executive chairman of Infosys, is part of a nine-member advisory council that will advise the Government of India on measures needed to design and accelerate the adoption of the Open Network for Digital Commerce (ONDC). “We are charting a new course and the goal is to change the rules of the e-commerce game,” he said.
What is Open Network for Digital Commerce?
ONDC is an open technology network based on open protocol and will enable local commerce across segments, such as mobility, grocery, food order and delivery, hotel booking and travel, among others, to be discovered and engaged by any network-enabled application.
The platform aims to create new opportunities, curb digital monopolies and by supporting micro, small and medium enterprises and small traders and help them get on online platforms. It is an initiative of the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry.
It aims at promoting open networks developed on open-sourced methodology, using open specifications and open network protocols independent of any specific platform. It is expected to digitise the entire value chain, standardise operations, promote inclusion of suppliers, derive efficiencies in logistics and enhance value for consumers.
The first-of-its-kind network, ONDC will help small traders and merchants achieve economies of scale. The new network is set to be rolled out very soon to select users in five cities — Delhi, Bengaluru, Coimbatore, Bhopal, and Shillong.
Anil Agrawal, additional secretary at DPIIT, has said, “We have identified five cities, as we wanted to keep a geographical spread across the board. We have a trader base in these five cities which is getting prepared on the intricacies of transacting on ONDC.”