Why PM Modi Calls ONDC a Game-Changer for Entrepreneurship

Prime Minister Narendra Modi today underscored the transformative role of the Open Network for Digital Commerce (ONDC) in empowering small businesses and reshaping the e-commerce landscape. His comments, made in response to Union Minister Piyush Goyal’s post celebrating ONDC’s third anniversary, highlight the platform’s growing significance in India's digital economy.

"ONDC has contributed to empowering small businesses and revolutionising e-commerce, thus playing a vital role in furthering growth and prosperity," wrote the Prime Minister on X (formerly Twitter).

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The Vision Behind ONDC

ONDC was launched to establish open networks for the exchange of goods and services across digital platforms. Built on open-sourced methodologies, the initiative democratises digital commerce by enabling interoperability and fostering participation from small and medium-sized businesses (SMBs) alongside larger players.

Encouraging Growth Metrics

The platform has witnessed a significant increase in adoption and activity. In December last year, ONDC facilitated about 5 million monthly transactions. This December, the figure has grown threefold to 15 million monthly transactions.

• Monthly Transactions: From 5 million in December 2022 to 15 million in December 2023.
• Sellers and Services: Over 700,000 onboarded, contributing to 150 million cumulative transactions.
• Mobility Services: Active in 18 cities across 8 states, with nationwide expansion underway.

With over seven lakh sellers and service providers onboard, the ONDC network has supported more than 150 million cumulative transactions. Its mobility services currently operate in 18 cities across eight states, with plans to expand nationwide.

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Empowering Small Businesses

ONDC has provided small businesses with a strong digital presence. Services like catalogue digitisation and seamless order fulfilment empower merchants to compete effectively in the e-commerce domain. Efforts to onboard farmer producer organisations (FPOs) and self-help groups (SHGs) have further increased inclusivity in the digital economy.

ONDC Priorities for 2025

For 2025, ONDC aims to attract digitally mature consumers and sellers, scaling transactions while driving the concept of "Bharat Ek Bazaar" (One Nation, One Digital Market). Enhancing logistics-as-a-service is another key focus area to streamline operations and support business growth.

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Collaborations with stakeholders form a crucial part of ONDC’s strategy. Financial assistance from the Ministry of Micro, Small and Medium Enterprises has already facilitated small businesses’ onboarding, with similar initiatives anticipated from other ministries and state governments.

Challenges and Opportunities

Despite its success, ONDC faces challenges in changing consumer habits and bringing more buyers and sellers onto the network. Specialised buying applications, including assisted commerce models, are being developed to widen adoption.

By creating an inclusive framework, ONDC transforms digital commerce in the country. The platform’s approach fosters opportunities for all stakeholders while driving innovation and growth within the ecosystem.

Growth Momentum and Future Plans

Monthly transaction volumes on ONDC are growing at a rate of 10-15%. Daily transactions have risen from 4.4 lakh in October to 5.1 lakh in December. With the onboarding of key partners like Bajaj and Ola, along with upcoming collaborations with DMRC and Mumbai Metro, transaction volumes are set to rise further. State-level initiatives in West Bengal, Odisha, and Andhra Pradesh are also accelerating local business participation.

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To ensure financial sustainability, ONDC plans to introduce a nominal network development fee. This fee will support the platform’s continued expansion and innovation while maintaining its non-profit-maximisation focus.

A Pioneering Model for the World

As a first-of-its-kind global initiative, ONDC sets a benchmark for open and public digital commerce protocols. Through collaboration and innovation, the platform creates a robust, inclusive, and sustainable ecosystem that aligns with India’s vision of becoming a digital powerhouse.

ONDC’s journey represents a paradigm shift in digital commerce, empowering small businesses and driving economic growth in a digitally inclusive manner.