Open Network for Digital Commerce (ONDC) on Monday announced the enablement of B2B transactions on the government-backed e-commerce network. Though it is currently in the alpha mode, about 160 B2B transactions have already taken place between network participants. ONDC has also set up a working group which is looking at finalising protocols for financial products such as credit and insurance.
The first B2B transaction on the network took place in May. Two start-ups SignCatch and Rapidor have successfully enabled both the B2B buyer and B2B seller side platforms on ONDC.
T Koshy, CEO, ONDC said, “B2B transactions have their own nuances and involve contractual obligations and negotiations between buyers and sellers. So, we have been closely working with network participants on the processes and protocols for this. The possibilities on B2B are even more as there are very few established networks unlike B2C space. Eventually, we expect B2B to become a big piece for ONDC.” He pointed out that this will involve different kind of buying in the form of bulk orders of products, warehousing and logistics.
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Koshy added that many larger logistics players are expected to come onboard or enable B2B transactions in the coming weeks and months through ONDC “We believe eventually every enterprise that has a product or service and is being sold to a broad segment of buyers will make their catalogue visible through ONDC,” he added.
Formal credit access
ONDC COO Vibhor Jain pointed out that out of the 100 million MSMEs in the country, less than one million transact digitally. “ The ONDC network has the potential to enable transparency and efficiency in B2B transactions. It can also help reduce costs of logistics for such transactions and also promote traceability. The other key thing can be access to formal credit for MSMEs,” he added.
“We have put in a working group involving ONDC, banks and NPCI under the guidance of RBI that is looking at protocols for financial products and service providers. This is expected to be finalised in a few months and includes credit and insurance.,” Koshy added.
Meanwhile, DPIIT Joint Secretary Sanjiv said, “ Network participants of course have to consider the profits and rightfully because then only the network will survive. But please keep in mind that the margins should be such that even small stores and buyers can onboard. The only thing they should keep in mind is that profit must be earned through volumes and not value.”