Empowering Kirana Shops: ONDC debuts, however questions linger

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The federal government’s bold impartial, open supply, not-for-profit, e-commerce platform, Open Community for Digital Commerce (ONDC), which goals to empower mom-and-pop retailers and kirana shops, rolled out on a pilot foundation on Friday. Nevertheless, specialists mentioned a number of challenges lie forward, which if not addressed correctly, could derail the undertaking.

Trade sources lauded the federal government’s initiative, which in some ways challenges the dominance of larger e-commerce gamers like Amazon and Flipkart.

The constructive facet of ONDC is that it gives a level-playing area to the sellers in addition to consumers. All type of sellers – large and small – can record and promote their merchandise on this platform. The identical applies to consumers who would have a wider array of decisions. With the unified cost system, the problem of cost gateways can be solved.

Nevertheless, many say all this will likely look good solely on paper. On the sensible entrance, a number of unfastened ends should be tied up earlier than the platform actually takes off.

As an illustration, there’s no readability but on the place the legal responsibility rests. Trade executives mentioned that on platforms like Amazon or Flipkart, the legal responsibility lies with the platform and never the sellers. If a shopper orders, the timing of supply, cancellation and return of merchandise are ruled by guidelines of the platform.

Nevertheless, with regard to ONDC, no such mechanism has been labored out but. “Suppose a shopper buys a product from a small kirana retailer on ONDC and the shop delivers the product late, what occurs? Who takes the accountability?” requested an trade govt.

Equally, if product purchases are to be cancelled or returned, would there be a uniform refund or cancellation pointers which might be relevant to all of the sellers?

Solutions to those important points have nonetheless not been communicated to the trade gamers.

Trade sources mentioned that within the absence of uniform pointers on such points, shoppers is probably not interested in ONDC and even when they’re, they might by no means purchase merchandise from small sellers.

One other space the place there’s no readability is whether or not small kirana shops might be able to match the reductions provided by greater sellers. Based on trade information, the typical order dimension on B2C platforms is within the vary of `150-300 and logistics and provide price is round 15-20%. Platforms like Amazon and Flipkart are in a position to supply reductions and bear losses however would smaller sellers be capable of do the identical? If they don’t, how would they be capable of compete with greater gamers?

The pilot initiatives have been launched on Friday in Delhi, Bengaluru, Bhopal, Coimbatore and Shillong. The 150 (focused) retailers/sellers will get to showcase their merchandise on sellers’ apps akin to Gofrugal, GrowthFalcons, Digiit and eSamudaay which are related to the ONDC community. They’ll ship merchandise by way of Goodbox, the one logistics supplier that has been onboarded up to now. Consumers can use Phonepe and Paytm to get into the community and purchase items from the sellers.

From nearly 150 sellers throughout the rollout of pilot initiatives in 5 cities, ONDC is aiming to onboard about 30 million sellers unfold throughout 100 cities in six months.

“By the pilot initiatives, we wish to be taught the way it works out in real-life environment the place items supply, funds and different features play out. As soon as the teachings are learnt, we wish to create a playbook, which is sort of a set of normal working procedures. We are going to make that public, in order that new comers (who wish to be part of the community) will be taught from it and act accordingly,” Anil Agarwal, further secretary within the division for the promotion of trade and inside commerce, instructed FE.

To date, about 20 entities have contributed a complete of Rs 255 crore into the ONDC fairness, Agarwal mentioned. These embrace NPCI and Punjab National Bank (Rs 25 crore every); Kotak Mahindra Bank (Rs 20 crore); Bank of Baroda, NSDL eGovernance and Nationwide Inventory Change (Rs 15 crore every); and BSE, State Bank of India, HDFC Bank and ICICI Bank (Rs 10 crore every).

Agarwal mentioned: “We’re creating a strong mechanism for refund, cancellation, public grievance redressal and on-line dispute decision. These are essential issues on the idea of which stakeholders’ belief shall be developed. That is additionally going to be the most important problem for us and we’re going to do it.”

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