On 24th February, Amazon announced that it is planning to integrate its SaaS products suite and logistics network with ONDC (Open Network for Digital Commerce), which is an e-commerce protocol supported by the Govt of India.
In a statement, the company stated, “This will be Amazon’s initial collaboration with ONDC as we continue to explore other potential opportunities for stronger integration between the two in the future.”
The aim of this integration is to increase 25% of e-commerce market reach over the next two years while catering to 1.2 Mn sellers, and 900 Mn buyers and covering the gross merchandise value of $48 billion.
The three key pillars on which ONDC is relying include inventory management, dynamic pricing, and optimization of delivery cost. These are meant to lower the cost of operation for all parties, including retailers.
In the month of April-2022, a soft launch was piloted in five major cities which include Delhi NCR, Bengaluru, Coimbatore, Shillong, and Bhopal. Apart from that, ONDC has started a beta pilot in tier-2 cities and Bengaluru.
Manish Tiwary (Country Manager at Amazon, IN) said, “Amazon’s vision and commitment for India are closely aligned with ONDC’s objectives of digitally enabling small businesses and providing convenience and choice to customers across the country. We are excited about the opportunities to mobilize Amazon’s industry-leading infrastructure and technology, including logistics and small business digitization tools, to help the ONDC accelerate its objectives. We remain committed to being a catalyst for India’s digitization efforts throughout the economy.”
Other fintech and e-commerce players that will join ONDC include Snapdeal, Meesho, Shiprocket, PhonePe, and Paytm.