SUMMARY
It would be very difficult to integrate ONDC in the B2B space in such a way that it leads to high-quality outcomes: PeerCapital’s Ankur Pahwa
ONDC is in a very early stage and its impact in the B2B space is very uncertain: IndiaMART CEO Dinesh Agarwal
However, the founders said that other components of the India Stack like cross-border payments can turn out to be game changers
The Indian government’s Open Network for Digital Commerce (ONDC) is likely to perform better in the B2C ecommerce space than the B2B segment, believes Ankur Pahwa, managing partner of venture capital firm PeerCapital.
Speaking at Inc42’s The Makers Summit 2023, Pahwa said, “ONDC [is] a great idea, [it’s] very early… It will probably do much better on the B2C side. The B2B elements and the nuances that it takes to make this work and integrate… I think it will be much more difficult to integrate and create high-quality outcomes from that.”
Echoing a similar sentiment, Dinesh Agarwal, CEO and founder of IndiaMART, said that ONDC is in its early stage and its impact in the B2B space is very uncertain.
The comments come at a time when the government is aggressively widening its ambitious ONDC programme, an open network built with the aim of unbundling the existing closed networks of digital commerce and helping small businesses participate in the Indian ecommerce ecosystem.
Backed by the Department for Promotion of Industry and Internal Trade (DPIIT), ONDC was launched in the latter half of 2022. So far, some of the major players across ecommerce, logistics, and payments ecosystems, including Paytm, Phonepe, Delhivery, IDFC Bank, Shiprocket, Dunzo, and Snapdeal have integrated with the platform.
Most recently, ONDC forayed into the mobility segment and onboarded Bengaluru-based auto booking app Namma Yatri on the network.
However, speaking at the event, Asish Mohapatra, cofounder and CEO of OfBusiness and Oxyzo, also said that ONDC would not see the amount of traction in the B2B segment as it is seeing in the B2C space.
Mohapatra believes that there are chances that a private player comes out and builds an easier and faster substitute of ONDC.
While the number of use cases for ONDC in the B2B segment aren’t high, the experts are of the opinion that other components of the ‘India Stack’ such as the cross-border payments system can have a bigger impact.
“I think the much-needed elements of cross-border payments and the opportunity that some of these things create… I would love to see how that can be built and expanded quite rapidly. And it’s a must-have given the entire export orientation approach that the government has,” said Pahwa.
India’s digital stack or the India Stack is a set of open APIs and digital public products covering identity, payments, among others. It includes Aadhaar, account aggregator framework, Unified Payments Interface (UPI), among others.
The Indian government has said it is willing to offer the India Stack to other countries to help them provide digital services to their citizens.
In February this year, India completed the cross-border linkage between its UPI and Singapore’s PayNow. The NPCI is also in talks with multiple other countries for UPI adoption.
