ONDC Slashes Network Partner Incentives By More Than 80%

SUMMARY

The state-backed network slashed the maximum limit of incentives granted to its network participants by 84% from the earlier INR 2.5 Cr to INR 40 Lakh

It has capped the cumulative subsidy given to the buyer side app, the seller side app and the logistics platform to INR 40

Logistics network participants which clocked more than 3 Lakh orders in the previous month would not be eligible to avail the incentives

Ahead of the festive season, state-backed Open Network for Digital Commerce (ONDC) has reportedly slashed the maximum limit of incentives granted to its network participants by 84% from the earlier INR 2.5 Cr to INR 40 Lakh.

According to a memo floated by the network and accessed by Moneycontrol, ONDC has capped the cumulative subsidy given to the buyer side app, the seller side app and the logistics platform to INR 40.

Besides, the network has introduced a fresh clause saying that the financial assistance will be provided only on orders placed between “different Buyer NP and Seller NP”.

The report added that logistics network participants which clocked more than 3 Lakh orders in the previous month would not be eligible to avail the incentives.

The report highlighted that the move is to prevent the concentration of a few big players on the network. It is pertinent to note that many ecommerce, logistics and D2C brands, including boAt, Magicpin, ShipRocket, Porter, Meesho among others, are listed on ONDC.

ONDC declined to comment on Inc42’s queries on the development.

This comes shortly before major ecommerce platforms kick off their annual festival season sales. The annual ecommerce bonanza will feature the likes of Amazon, Flipkart and Meesho luring customers by offering discounts and offering products across categories such as smartphones, fashion and beauty, consumer electronics, grocery, among others. Amazon and Flipkart are not listed on ONDC despite the central government pushing them to get onboard.

Launched in 2021, ONDC is an initiative by the Department for Promotion of Industry and Internal Trade (DPIIT), under the Ministry of Commerce & Industry. It aims to promote open networks for the exchange of goods and services over digital or electronic networks. It claims to be online in over 611 cities with 111 network participants.