OPEN NETWORK FOR DIGITAL COMMERCE (Syllabus GS Paper 2 – Governance)

News-CRUX-10     18th May 2024        
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Context: Recently, the Department for Promotion of Industry and Internal Trade (DPIIT) said transactions on Open Network for Digital Commerce (ONDC), crossed 70 lakh in this year.

Open Network for Digital Commerce (ONDC):

  • About: The ONDC entity, a not-for-profit company incorporated under Section 8 of the Companies Act 2013, manages and operates the ONDC Network.
  • Responsibilities: It is responsible for building and maintaining the underlying infrastructure as well as defining the rules of engagement and code of conduct for the Network Participants through the ONDC Network Policy and the ONDC Network Participant Agreement
  • Not Application: ONDC is not an application, an intermediary, or software; it is a set of specifications designed to facilitate open interchange and connections between shoppers, technology platforms, and retailers.
  • Components:

o Buyer-side apps: Consumers place orders.

o Seller-side apps: Merchants are onboarded and their listings displayed.

o Logistics platforms: Handle deliveries.

  • Aim: Promote open networks for exchanging goods and services digitally or electronically., Create new opportunities and curb digital monopolies., Support micro, small, and medium enterprises (MSMEs) and small traders to get online, Democratize digital commerce from a platform-centric model to an open-network.
  • Benefits: Provides small retailers with an opportunity to offer services and goods nationwide through an e-commerce system, Enables merchants to save data to build credit history and reach consumers, Expected to digitize the entire value chain and promote the inclusion of suppliers, Enhances efficiencies in logistics and value for consumers
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