SUMMARY
NSDL invested an amount of INR 10 Cr in the state-backed venture via the private placement route
The open network which aims to democratise the ecommerce space in the country is also backed by various public and private sector banks
Earlier this week, reports said that the RBI has stalled NPCI’s bid to acquire a stake in ONDC
The National Securities Depository Limited (NSDL) on Wednesday (October 12) said it has picked up a 5.6% stake in the state-backed Open Network for Digital Commerce (ONDC).
NSDL invested an amount of INR 10 Cr in the ecommerce venture via the private placement route.
“This strategic deal will further strengthen the digital ecosystem to take digital e-commerce to the people of India,” NSDL MD and CEO Padmaja Chunduru said.
Echoing the sentiment, ONDC CEO T Koshy added, “We are glad to have NSDL as a stakeholder which would be of strategic benefit considering their experience in reach and technology.”
The announcement comes almost a month after reports emerged that the depository was looking at acquiring a stake in the much touted digital commerce platform.
A brainchild of the Department for Promotion of Industry and Internal Trade (DPIIT), ONDC aims to revolutionise the ecommerce space by deploying open protocols to enable local commerce across a multitude of segments such as grocery delivery, mobility, hotel booking, among others.
Incorporated as a non-profit and unveiled last year, ONDC has seen public and private sector banks line up to invest in the platform. Major players such as the State Bank of India (SBI), Punjab National Bank, Axis Bank, Kotak Mahindra Bank, and HDFC Bank have invested in ONDC. In total, INR 250 Cr has so far been pumped into the venture by multiple stakeholders.
Earlier this week, reports said that the Reserve Bank of India (RBI) has stalled the National Payments Corporation of India’s (NPCI’s) bid to acquire a stake in ONDC citing potential conflict of interest.
The central bank reportedly noted that NPCI’s plans to develop ONDC’s payments and settlement system alongside its bid to pick up a stake in the network could render it a non-neutral party. The RBI has now sought more time to study the proposal.
Overall, the ONDC is currently only available to the public in parts of Bengaluru city. Besides, the network has also set its eyes on going live in Delhi and Mumbai.
While the Bengaluru launch late last month saw an underwhelming response, the network continues to scale up its operations and has been looking to add more buyers and sellers. It has set a target of expanding its coverage to 100 cities and adding more than 30 Mn sellers on the network.
Earlier this month, the network released a consultation paper and sought public comments from the general public to build trust in ONDC.
ONDC will operate in the ecommerce space, currently dominated by Flipkart and Amazon in the country. With increasing internet and smartphone penetration and rising disposable incomes, the space has grown by leaps and bounds over the last few years.
According to an Inc42 report, India’s total addressable ecommerce opportunity is expected to grow to a size of $400 Bn by 2030.
