ONDC's Expectations From 2023
As we enter into 2023, ONDC completes one year since its inception, checking off key milestones over the course of the year - conducting the alpha and beta launches in Bengaluru and Meerut, onboarding several key pioneer partners (read believers), enabling transactions in Grocery, Food & Beverage categories, putting the key building blocks of trust in place and enabling thousands of Sellers to realise the Digital Bharat dream! However, reflecting on the past year, the most significant milestone we achieved was not just silencing some of the staunchest naysayers, but also convincing them that transactions in an unbundled environment are indeed possible.
ONDC will spark the crucial element required for enabling digital commerce at a national scale - behaviour change, primarily unlocked by innovation in the space.
With the dust settling over some of our initial successes, 2023 is of immense significance for ONDC. Today, selling on digital commerce is still considered to be attainable by the few, meant for those who are part of an exclusive club. 2023 is when the first signs of a truly democratised digital commerce landscape will start taking shape. Buyers and Sellers, alike, will start witnessing that transacting digitally will become the norm, leveraging the plethora of benefits that e-commerce offers such as greater choice, greater discoverability, convenience and strongly complemented by the obvious business sense of buying and selling online. In terms of enabling pillars, we are already well endowed with rapidly proliferating internet and digital access, increased adoption of UPI, low data prices, and a digital financial footprint. ONDC will spark the crucial element required for enabling digital commerce at a national scale - behaviour change, primarily unlocked by innovation in the space.
In 2023, I foresee the first wave of innovation emerging out of ONDC, especially in technology and business. This will be possible because of unbundling and interoperability, which will bring down barriers to entry on both the technology and business front. Budding tech entrepreneurs as well as legacy businesses can now focus on leveraging their niche capabilities, instead of building fully vertically integrated entities. With the advantage of network-wide scale available at their footing, startups can tap into the expertise and capabilities of other enterprises to deliver innovative products and services in delivering to the needs of customers in new and exciting ways. Take for example, consumer tech startups, across various categories, can build applications engaging Buyers in new, unprecedented ways without having to build supply side capabilities. Similarly, on the supply front, network level innovations can emerge which will help unlock efficiency in production and distribution. These exciting innovations will play the most crucial role in driving behaviour change towards helping realise the true potential of digital commerce and carry the mantle from the pioneering behemoths of the e-commerce ecosystem.
2022 saw many large, successful companies such as PhonePe, Meesho, Snapdeal, Paytm along with a few hundred start-ups like SellerApp, GoFrugal, DIGIIT, eSamudaay, Growth Falcon, etc integrate with ONDC, and I expect many more to join ONDC in 2023 with a pipeline of around 700 entities already submitted an Expression of Interest.
With the increase in digital commerce penetration, we will see participation from both large and small e-commerce establishments in the ONDC network as they will look to capture the enormous, untapped segment of both Buyers and Sellers which will start transacting online. Remember that today, only an estimated 6-7 per cent of the consumers in India shop online, and on the other hand, maybe 1 per cent of the Sellers sell through digital channels. 2022 saw many large, successful companies such as PhonePe, Meesho, Snapdeal, Paytm along with a few hundred start-ups like SellerApp, GoFrugal, DIGIIT, eSamudaay, Growth Falcon, etc integrate with ONDC, and I expect many more to join ONDC in 2023 with a pipeline of around 700 entities already submitted an Expression of Interest. E-commerce giants such as these will be brand ambassadors, who’ll of course play a key role in lending credence about ONDC to many businesses joining the Network.
To build trust in an unbundled environment, ONDC is also setting up key elements of trust building measures such as Issue and Grievance Resolution, Scoring and Badging, Reconciliation and Settlement, Cataloguing Services etc. Many of these trust-building measures such as issue resolution and reconciliation and settlements are already live, while the rest are still being devised. These measures will address challenges inherent in e-commerce and ensure stability in conducting digital commerce transactions through the ONDC protocol. By the end of 2023, these measures will be synonymous with reliable and secure online transactions.
Along with other emerging open-source Digital Public Goods (DPGs) such as UPI, Account Aggregator, Unified Health Interface and Open Credit Enablement Network, 2023 will witness several exciting opportunities of ‘inter-network innovation’ and value unlock based on ‘inter-network data portability’.
With the recent landmark milestone of ascendency to the Presidency of the G20, India is going to be in global spotlight, which is a huge opportunity for us to prove that ONDC cannot just help transform the landscape of digital commerce domestically - but that it is India's solution to a global problem. Along with other emerging open-source Digital Public Goods (DPGs) such as UPI, Account Aggregator, Unified Health Interface and Open Credit Enablement Network, 2023 will witness several exciting opportunities of ‘inter-network innovation’ and value unlock based on ‘inter-network data portability’. I’m particularly excited about the new opportunities and technologies that will emerge in 2023, which I consider to be the most important indicators of success of the technological revolution that India is leading under visionary leadership of the honourable Prime Minister.
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