Commerce and Industry Minister Piyush Goyal has reviewed the progress of the Open Network for Digital Commerce (ONDC). He was informed that since the alpha launch in five cities in April, ONDC has been testing with a closed user group for end-to-end execution to understand their fulfilment. ONDC expects the number of network participants to substantially increase to more than 30 in the coming weeks. Building on this, ONDC plans to start beta-testing the network with public users in limited areas.
Goyal said that while continuing various network development initiatives, it must be kept in mind that the basic purpose of ONDC is to assist the small, undigitised trader, who must be assisted to get digitised and avail opportunities offered by the e-commerce ecosystem.
“He said that existing e-commerce platforms are popular because they remain consumer focused. They have created robust trust in their platforms based on their ability to deliver on promises made about products, fulfilment of orders in time, no-questions-asked returns policies, and consumer-friendly refunds and cancellations,” the commerce and industry ministry said in a statement.
ONDC will be tested against these benchmarks. ONDC must create consumer trust through robust mechanisms for ensuring redressal of grievances of consumers and enforcing transparent policies for returns, refunds and cancellations, he added. These policies are to be implemented at the network level.
What is ONDC?
The Open Network for Digital Commerce (ONDC) is an open technology network based on an open protocol. The platform will allow buyers and sellers to connect and transact with each other online, regardless of what other applications they use. It saw a pilot launch in April in five cities — Delhi, Bengaluru, Coimbatore, Bhopal, and Shillong.
The buyers and sellers do not have to use the same platform or same mobile app to have a transaction. They can use different applications and still do business transactions.
The foundations of ONDC are to be open protocols for all aspects in the entire chain of activities in the exchange of goods and services, similar to HTTP for information exchange over internet, simple mail transfer protocol for exchange of emails and unified payments interface for payments, according to the commerce ministry.
The benefits of ONDC include access to more buyers; better discoverability of products and cost; autonomy on terms because of multiple choices for being digitally visible; lower cost of doing business; and more options for value chain services like logistics and fulfillment.
According to a strategy paper by this ONDC entity published in January, there needs to be “a paradigm shift from an operator-driven monolithic platform-centric model to a facilitator-driven, interoperable decentralized network”.
The ONDC will not be owned or controlled by a single entity or platform and the idea behind it is to connect buyers, suppliers, payment, and logistics providers through open-source specifications and protocols.
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