The digital revolution and its humongous transformational effects are seen and experienced across India. India’s developmental journey has witnessed many firsts because for this experiment in democracy to succeed the socio-economic ground has to be fertile. This fertility has been enhanced through diverse measures but one such that has effectively stood out is digitalisation at scale unseen. Its direct paradigmatic altering change is the digital delivery of public goods. This precise method of delivery has been instrumental in shaping a developmental story transcending bureaucratic logjam. Hence digitisation and its multi-dimensional changes has propelled the knowledge economy into newer territories. Digitisation has numerous facets, one major amongst it is digitising financial and payment structures. The UPI revolution has quadrupled the economy into a cashless highway through a lightning speed transition. This has had an effect on retail commerce as India’s behemoth demand for retail products is now being satiated with e-commerce and supporting online payment structure. This twinning of UPI and e-commerce that has only been propelled in Covid years now presents itself as the dominant retail game in town. Each seller now is transitioning to online channels and varieties of e-commerce experiences like social or community commerce are developing. Though a casualty has been small retailers who still are finding it extremely taxing to transition themselves into digital commerce. Numerous start-ups and e-commerce giants have predominantly begun promoting mom-and-pop shops along with Kirana stores and micro businesses but still unlike UPI this story lacked a catalyst until now. Thus the government formulated ONDC (Open Network Digital Commerce) to end the monopoly of online retail giants and enact an institution that surpasses technological barriers erected by e-commerce players to the detriment of millions of small retail actors. ONDC has already begun its market testing and how it will upend the oligopolistic behaviour of online giants is yet to be seen but this mechanism like UPI is bringing another interesting indigenous digital-business facet.
I propose that if ONDC is transformed from an open sourcing network to a low-cost platform for logistic business and financial institutions owned either by government or in conjunction with market players then this might alter status-quo across e-commerce ventures. The new status-quo will hence be beneficial to small retailers and micro-business and their negotiating power will dominate the spectrum. ONDC ought to become a platform that connects millions of micro-sellers across India with logistics based delivery companies that can then ship these to customers. Sellers can be on-boarded either directly on ONDC platform hence it acts as an e-commerce player or it can provide sellers to break silos of any major online player to be seen on ONDC. Then when a customer purchases these sellers have the option to connect with logistics based companies which can then ship the products. One question may arise about stocking of products beforehand like in the inventory led model for seamless delivery but if the platform catalyses into scale quickly then it eliminates price inefficiencies that may happen with each seller picking logistics delivery partners for sale. ONDC can also incorporate modern trade like hyper-local delivery in reasonable time through pin-code specific sellers reaching mutual pin-code sharing buyers. Lastly ONDC may also use the enormous data it will collect to provide micro-businesses credit to expand or working capital. This can be done through government banks and ONDC as a fin-tech pre-approving credit seekers. With low interests and quick & seamless delivery of credit, the government will transform the retail sector across India and end the monopoly of online players along with their restrictive business practices.
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