SBI, NPCI, NSE likely promoters of 'open' e-platform for retailers

Top banks, stock exchanges as well as payments and settlement organisations have expressed interest in the government’s plan to create a digital platform on an open network to enable a wide variety of local retailers to sell their products and services.

National Payments Corporation of India (NPCI), State Bank of India, HDFC Bank, the National Stock Exchange, the BSE, NSDL, and National Bank for Agriculture and Rural Development, among others, have committed to be the promoters of the private sector-led non-profit company that is expected to launch Open Network for Digital Commerce (ONDC), a senior government official told Business Standard. The network aims to curb digital monopolies.

ONDC is a network based on open protocol and will allow local commerce across segments such as mobility, grocery, food order and delivery, hotel booking, and travel. This, the government believes, will give a free and fair choice to consumers to buy products on an online platform from domestic retailers.

ONDC will help micro, small and medium enterprises and small traders get on online platforms, giving them equal access towards digitisation. Here, the buyer and the seller will use the same platform to do a business transaction.

“For instance, the ONDC platform will give equal opportunity to offline traders to sell their products through an online platform. It will not be limited to a specific category of product or service, which exists right now,” the official said.

The idea is to create a level playing field for both e-commerce players and offline traders. The latter have been crying foul about the alleged unfair trade practices of e-tailers.

“The application will also be available in local languages, so that the seller in any part of the country can access it without any (language) barrier,” the official said.

A non-profit company structure, according to the government, is expected to remove any incentive for owners to drive for profit maximisation, while focusing on ethical behaviour and following rigorous norms of governance and transparency.

“The role of the entity would be to develop the network by adopting and building enabling technology and encouraging wide-scale voluntary participation by players. It would ensure network discipline by establishing a code of conduct and rules of the network based on principles of consumer protection, fair trade and regulatory conformity,” the Department for Promotion of Industry and Internal Trade (DPIIT), which is spearheading the initiative, had said.

In July, Infosys non-executive chairman Nandan Nilekani, National Health Authority CEO R S Sharma, and seven other experts were appointed to a council to advise the government to design and accelerate the adoption of ONDC.