Understanding ONDC

Currently, digital markets are closed and platform-centric wherein buyers and sellers need to be on the same platform to carry out a transaction. The current model of e-commerce stifles innovation, creates significant barriers to entry for new players, and creates a gap between online demand and the local retail ecosystem. As a result participation in e-commerce is well below its potential and has a tremendous opportunity to grow manifold.

ONDC, on the other hand, does not require that buyer and seller must use the same platform/application to do a business transaction. Instead, it is a network-centric model where, so long as platforms/applications are connected to this open network, buyers and sellers can transact irrespective of the platforms/applications they use. Its like the “UPI of e-commerce”.

Existing Platform-Centric Model

Here, buyers and sellers must use the same platform/application to do a business transaction

ONDC’s Network-Centric Model

Buyers will be able to access all services currently provided by various sellers on different platforms, through a common network.