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23rd March 2022 (10 Topics)

ONDC to democratise e-commerce and help protect small businesses


Union Commerce and Industry Minister recently said Open Network for Digital Commerce (ONDC) would democratize e-commerce and will protect small businesses by granting them equal opportunity.


About Open Network for Digital Commerce (ONDC):

  • Open Network for Digital Commerce christened ONDC is globally first-of-its-kind initiative that aims to democratise Digital Commerce, moving it from a platform-centric model to an open-network.
  • It aims to ensure that small retailers get an equal opportunity to engage with big firms, protect their businesses and serve customers with modern ways of delivery system.
  • As UPI is to the digital payment domain, ONDC is to e-commerce in India.
  • It will enable buyers and sellers to be digitally visible and transact through an open network, no matter what platform/application they use.
  • ONDC received its certificate of incorporation as a private sector non-profit company in December, 2021.
  • A number of established companies have integrated with the platform.
  • The platform will provide opportunities for new start-ups to start creating a network of sellers, provide service to local areas, and increase competition.

Aims and objectives:

  • ONDC aims at promoting open networks developed on open-sourced methodology, using open specifications and open network protocols independent of any specific platform.
  • ONDC is expected to digitize the entire value chain, standardize operations, promote inclusion of suppliers, derive efficiencies in logistics and enhance value for consumers.

About open-source:

  • Making software or a process open-source means that the code or the steps of that process is made available freely for others to use, redistribute and modify.
  • An open-source project means that anybody is free to use, study, modify and distribute the project for any purpose.
  • These permissions are enforced through an open-source licence easing adoption and facilitating collaboration.
  • For example, while the operating system of Apple’s iPhones — iOS — is closed source, meaning it cannot be legally modified or reverse engineered.
    • Google’s Android operating system is open-source, and therefore it is possible for smartphone OEMs such as Samsung, Xiaomi, OnePlus, etc to modify it for their hardware.

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