Microsoft gives ONDC its first Big Tech push

Microsoft has become the first global Big Tech company to join the Open Network for Digital Commerce (ONDC), an Indian government initiative for developing a first-of-its-kind open network for digital commerce.

Photograph: Charles Platiau/Reuters

The world’s second-largest technology firm intends to introduce social e-commerce via its app in the Indian market later this year.

ONDC is expected to open to the public in Bengaluru over the next fortnight as it enters into the next phase of the pilot for further fine-tuning before rollouts in other cities, according to a source in the know.

ONDC already has a large number of merchants from the city on the platform.

While announcing its ONDC onboarding efforts, Microsoft sa­id it plans to launch a shopping app for Ind­ian consumers, along with their social circle, harnessing the open network to discover the best pricing among retailers and sellers.

“The Indian e-commerce industry has tremendous growth potential in the next decade. Initiatives like ONDC can be a game-changer amid this boom.

“Their UPI-like network for digital commerce is a win-win for both buyers and sellers, as it will en­able them to connect without dependency on any e-commerce solution.

“We are delighted to collaborate with ONDC and can’t wa­it to witness this journey un­fold as we plan to introduce a new consumer app experience in the social commerce space,” a Micr­o­soft spokesperson said.

The US-based tech giant is still in the proce­ss of integrating with the network.

The government-backed network is currently in the pilot phase in 36 cities across the country and has already onboarded nine platforms and is in an advanced stage of development of adding another 17.

ONDC also has garnered interest from various other platforms, which including telecom majors and banks, according to a source in the know.

The network first began its pilot on April 29 in De­lhi, Bengaluru, Coimbatore, Bho­pal and Shillong and is in the process of adding more cities before a nationwide launch.

Platforms that have already integrated with ONDC include Paytm, Digiit, eSamudaay, Go Frugal, Growth Falcons, Seller App, Dunzo and Loadshare.

And those in advanced stages of development with the network are Kotak, Phonepe, Snapdeal, Sonata, Ushop, Zoho EKart, Ship Rocket, and Bizom, among others.

Those that have shown interest include HDFC Bank, ICICI Bank, IDBI Bank, India Post, ITC store, Marico India, Nivea India, Samsung India Electronics, SBI Bank, Delhivery, and Airtel.

The government’s initiative for digital commerce intends to increase the gross merchandise value (GMV) of digital transactions from Rs 4.5 trillion annually to over Rs 7.5 trillion in five years.

It also looks to expand the coverage of retailers using digital commerce from 15,000 to more than 2 million in five years, and also boost the number of Indians using e-commerce from 90 million users to more than 250 million.

The network aims to provide more access to businesses by increasing discoverability at a low cost.

Also, it looks to enhance autonomy (due to multiple choices for being digitally visible), as well as value-chain services (like logistics) to support business growth.

For buyers, ONDC’s protocol will provide access to more sellers, enhanced service levels, and faster deliveries due to access to hyper-local retailers.

Overall, there shall be a better customer experience.

The project is sponsored by the Department for Promotion of Industry and Internal Trade (DPIIT) and has been set up as a Section 8 company (non-profit organisation).

It is also in the process of completing a small fundraise.

This will take its total fundraise to Rs 195 crore.

It had earlier raised Rs 157 crore from 17 banks and financial institutions. National Payments Corporation of India (NPCI), National Securities Depository Limited (NSDL), and Bank of India are part of the ongoing fundraise.