ONDC is confusing.

So was UPI when it was first released in 2016.

The concept of e-wallets was first pioneered by the likes of Paytm, Freecharge, Mobikwik.

The initial payments infrastructure supported bill payments and mobile recharges primarily.

And, the experience for Peer-to-Peer was very different from what it is today.

If you had to transfer money to a friend, you’d first need to upload money from your bank to your wallet and then proceed with the transfer.

At that point, no one could say that UPI would change the way Digital India transacts.

ONDC’s ambition is to do something similar for the e-commerce space.

In my understanding, it’s trying to do so by:

• Creating a open-source infrastructure for
a) sellers
b) buyers
c) payment aggregators
d) logistics players

• Currently, the entire online buying journey is controlled by player the customer is transacting with.

Amazon for instance has it’s own payment gateway and logistics services.

With the adoption of ONDC, customers could get more choice in terms of sellers, payments and logistics partners.

At this point, ONDC is in its nascent stage and only with time we’ll be able to see it’s front end application.

Reference: Indian Dream Project episode on ONDC