SUMMARY
The Bank of India has purchased 1 Mn equity shares of INR 100 each
The transaction is expected to be completed by the second quarter of the financial year 2022-23
Previously, the State Bank of India, Kotak Mahindra Bank, Axis Bank, HDFC Bank, IDFC First Bank, and ICICI Bank have also invested in the digital ecommerce venture
State-owned Bank of India has invested INR 10 Cr in the government-backed ecommerce venture Open Network for Digital Commerce (ONDC) via the private placement route. Once the deal is executed, the bank’s total stake in ONDC will stand at 5.56%.
“In accordance with the provisions…, we hereby inform you that on 27.09.2022, Bank has invested in the capacity of promoter shareholder of ONDC, an amount of INR 10 Cr in ONDC under private placement route,” said the company in a regulatory filing.
The Bank of India has purchased 1 Mn equity shares of INR 100 each and the transaction is expected to be completed by the second quarter of the financial year 2022-23 (September-end).
Incorporated as a private sector non-profit company, ONDC will enable sellers across a wide variety of segments to list on the platform and offer a host of services to customers at one single place.
The ONDC pilot is currently underway cities including Delhi, Bengaluru, Shillong, Coimbatore, Bhopal and Lucknow. Since then, the project has been expanded to 15 more cities and had around 100 sellers at the end of August.
ONDC aims to reach around 100 cities, 30 Mn sellers and 10 Mn vendors by the end of the current year.
Interestingly, Union Minister Piyush Goyal, earlier this month, said that the ONDC will be thrown open to the public in 1-2 cities by the end of this month. There has been no update on that ever since. However, a report by Business Today claims that the service is all set to go live in Bengaluru on September 30.
The platform has already onboarded major new age tech startups such as PhonePe, Dunzo, Paytm, and Grab. However, challenges continue to mount ahead of the launch of the digital platform.
Speaking at Inc42’s The D2C Summit 3.0 earlier this month, ONDC’s chief business officer (CBO) Shireesh Joshi said that it was working on creating a composite reputation ledger to enable users to understand and trust sellers.
Earlier this month, it was also reported that the ecommerce venture would likely publish a draft framework in early October to deal with dispute resolution.
Bank of India follows a long line of public and private banking institutions that have invested in the government’s ambitious digital commerce venture.
The State Bank of India, Kotak Mahindra Bank, Axis Bank, HDFC Bank, IDFC First Bank, and ICICI Bank have each picked up a 7.84% stake in the ONDC for a consideration of INR 10 Cr each.
According to an Inc42 report, India’s total addressable ecommerce market opportunity is estimated to soar to $400 Bn by 2030.
