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![e005.png](https://images.hive.blog/DQmPn1i4zHEDSBAJhqPVF9KP5NTuAy11gEKrkE2Ec7BdkP7/e005.png)

## ONDC- Open Network Digital Commerce

How many of the e-Commerce giants do you know or have engaged or accessed in your lifetime or recently? If I could take a social survey by targeting the age group of 18-36, most of the youth's obvious answer would be Amazon followed Flipkart, there are many others, no doubt about that, but like Facebook and Twitter, most of the people in India are familiar with these two e-commerce platforms.

Jeff Bezos is the second richest after Elon Musk. And Amazon has indeed penetrated deep into the e-commerce market in India. Now the point is when you grow big and particularly in the e-commerce digital space not only do you grow in your business, but also your data bank goes big and becomes an important silo of the database. 

All the e-commerce digital platforms with popularity and with the Govt's policy of digitization, have significantly done well in the recent past, particularly in the last 5 years. Some people are even saying that e-commerce has been taking a lion's share of what malls hitherto have in this space, they even pose a threat as an alternative to what the people need in the retail sector.

But the most important fact is that alongside their primary business, silos of the database have been growing which in itself is an asset. When you have so many silos and so many individual sites with no interoperability among the different ones, you would certainly end up cluttered with so many sites at your disposal and it becomes hectic to deal with those things when you need something but not being able to trace it.

That is where you need a common protocol where these sites stand individually but they all run on a common sub-structure. Blockchain technology and different dApps on top of it is a perfect example of how we conceptualize and run such a model and offer the clients a one-stop solution for a variety of their requirements.

ONDC was recently announced by India and have been piloted in a few major cities(New Delhi, Bengaluru, Bhopal, Shillong, and Coimbatore) and this is what we are going to discuss here today. By definition a protocol has certain attributes and from that, we can deduce whether it is a Blockchain network or not. Blockchain network has certain peculiar characteristics with the notable ones being append-only data base, immutability, and decentralized(permissionless). We can have a permissioned Blockchain as well. But the immutability and append-only database will remain fundamental to a Blockchain protocol.

ONDC is definitely an effort to foster a sense of democratization of the e-commerce space and it is a good step forward to make it more convenient and easy for the end user.

ONDC comes under DPIIT(Department for promotion of industry and internal trade), and DPIIT in turn comes under the Ministry of Commerce and Industry. 


![e001.png](https://images.hive.blog/DQmTgqtfibkgHwAeg1iZtXy4o9vNxVRJ4VJJycbGioGTtyV/e001.png)
<sub>[Source](https://www.statista.com/forecasts/1218264/india-top-online-stores-india-ecommercedb)</sub>

Let's have a look at the net sales of top online stores in India. Amazon tops the list with 1082 million USD followed by Ajio, Bigbasket, Jiosmart, etc. Jiosmart features in the 4th spot with a total net sales of 424 million USD.

What exactly you do when you want to purchase something from these online stores is that you go and access the site individually and also get registered and furnish your details on those sites where you want to buy something. With ONDC what will happen is you don't have to furnish the data, again and again, you just need to do it once, because ONDC will be a protocol at the sub-structure and the data of this substructure will be accessible to the various online stores who will run their site as dApp, on the top of ONDC. So the end user just needs to have one credential to locate and access the various online stores.

Definitely, it will save a lot of time and it will herald a new revolution in the e-commerce sector which is a booming sector and the penetration is slated to rise further until it reaches a peak at around 2040-50 as analyzed by the experts.


![e002.png](https://images.hive.blog/DQmbn7NCt3WGRSoHTGcfnwti4JPn7mnoN5ogxB4gLoyLFMW/e002.png)
<sub>[Source](https://www.statista.com/statistics/792047/india-e-commerce-market-size/)</sub>

ONDC will definitely bring interoperability between the big and top-rated online stores. It will further enhance the business potential because the concentration of the market in one place and consolidation of segregated data in one place will always allow seamless operation of the e-commerce segment.

QCI(Quality Council of India) has been tasked to integrate the e-commerce sites with ONDC based on open-source methodologies. Certainly, they are using open specifications, but the operation and functioning are yet to be disclosed to call it a completely decentralized protocol or not.

The best part I like about ONDCis that it aims at unbundling the choice of a delivery service provider, that's a good beginning and offering choice to the end user is always a welcoming step. Along with that, they are certainly going to launch this on the lines of UPI(United Payment Interface). UPI is a grand success, no doubt about it, the micropayment transaction has gone up manifold in the last five years that India might not have thought of at the time of launching UPI. It's good if they can bring such seamless integration of e-commerce sites with ONDC.

Let's see who the players & early adopters who have a stake in ONDC. 


![e004.jpg](https://images.hive.blog/DQmb1aqiDnWRdnj8kQCqfKS3MxJ3N1dnn3z6yipfGvbptYt/e004.jpg)


CSCs(Common Service Centers) are also tasked to take ONDC to the rural level for the promotion of commerce and logistics in rural areas. 

Please do note that ONDC is not a kind of aggregator. It is also not a hosting platform either. 

The various standardized operation that ONDC will offer are:-
(i) Order matching/ fulfillment
(ii) Inventory Management
(iii) Integration of Payment services
(iv) Cataloging

#### Conclusion:-

The current e-commerce market size in India is roughly around 100 Billion USD, and it is slated to go up as high as 350 Billion USD. If the penetration of the internet together with online retail stores intensifies in rural areas, then the B2C commerce will also get amplified. 

![e003.png](https://images.hive.blog/DQmT7bmauLnNWK6bLSN6CzJkk4Vt6Gaou218WFAWEDd4PiH/e003.png)
<sub>[Source](https://www.statista.com/statistics/792074/india-internet-penetration-rate/)</sub>

With this projection in place, the introduction of ONDC with a pledge to open source methodology will herald a more open and democratized e-commerce world and the different silos will break its barrier to offer a more fluid, consolidated, and concentrated marketplace, where the needs of either side will be fulfilled at one go. Open Source methodology is the way to go both intellectually and commercially. 

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