The government plans to roll out its indigenously developed online e-commerce network for the public in 100 Indian cities by Diwali to provide millions of kirana stores and consumers an alternative to multinational platforms such as Amazon and Flipkart.
Union commerce and industry minister Piyush Goyal on Friday announced the test-launch of the open-source system. The beta launch will unveil the IT applications of the Open Network for Digital Commerce (ONDC) and registry covering a small number of retailers and customers initially in Bengaluru on Friday, two people directly associated with the project said.
“After UPI (Unified Payment Interface), another game changing idea to democratise commerce – ONDC soft launch today to select consumers, sellers and logistics providers. Get ready for a world of choice, convenience and transparency,” the minister said in a tweet on Friday.
The project is massive as it will provide a wide choice to all consumers and retailers and the formal launch will take place after successful testing of the system, said Anil Agrawal, the additional secretary in the department for promotion of industry and internal trade (DPIIT).
“End-to-end testing is being done to create a playbook with an aim to launch it in 100 cities in six months [by October 2022],” he said.
About 15 restaurants and grocery stores have been registered in Bangalore along with select consumers to begin the trial with actual delivery of products, ONDC chief executive officer Thampy Koshy said in Bengaluru on Friday.
“This is the field trial with real transactions. In the coming week, we will cover two big and three smaller cities. Based on the experience, we will gradually scale it up,” he said.
The ONDC system is different from the operational models of existing e-commerce companies in India and abroad where buyers and sellers are restricted to their respective platforms, Koshy said.
“Our model is platform-agnostic. This is unique, it’s never been done anywhere in the world. Hence, a considered approach,” he said.
“ONDC is based on interoperability where all platforms will talk to each other,” Koshy said.
The system will have multiple choices for both retailers and customers in terms of cataloguing, inventories, warehousing, suppliers, logistics and payments, he said. The initial test launch, which was started in Bengaluru, will also cover cities such as Delhi, Coimbatore, Bhopal and Shillong.
Amazon India said they are “closely engaging with the ONDC team to better understand the proposed model”. “We remain committed to the government’s vision of digitizing kiranas, local stores and creating opportunities for businesses across India by simplifying technology adoption to help local stores and businesses contribute to India becoming a $5 trillion economy. We are closely engaging with the ONDC team to better understand the proposed model and evaluate the role Amazon can play to better serve Indian customers and sellers,” an Amazon India spokesperson said.
Flipkart did not respond to email queries on this matter.
Experts who wish not to be named said the ONDC model may also have some challenges such as the return policy, which is currently the responsibility of the e-commerce platforms.
The other challenge could be related to consumer grievance redressal.