What is ONDC

ONDC (Open Network for Digital Commerce) is an Indian government-backed open network that lets shoppers on one app buy from sellers listed on another. Instead of every seller joining every marketplace separately, a seller joins once through a seller app, and buyer apps across the network can show its products.

• What it is: A network with shared rules and open technical standards, not a shopping app.
• Who backs it: Set up as a not-for-profit company with support from DPIIT, under the Ministry of Commerce and Industry.
• Who joins: Buyer apps, seller apps, logistics providers and other service providers, called network participants.
• Why it exists: To make digital commerce less dependent on a few large platforms and easier for small sellers to join.
• Categories: Groceries, food, fashion, home goods, electronics and more, with some areas far more active than others.

This lesson follows one example: a family-run kirana store in Lucknow that sells groceries, dairy and household items to nearby homes. The owner already takes UPI payments and receives orders on WhatsApp, but large delivery apps feel expensive and hard to join. ONDC offers a way to reach shoppers on several apps through one listing.

Key Characteristics of ONDC

• Open and interoperable: Any buyer app on the network can discover products from any seller app on the network, much as UPI lets any payment app send money to any bank.
• Unbundled roles: Showing products, managing the seller's catalogue and delivering the order can each be handled by a different company.
• Protocol-based: Participants follow shared technical specifications, built on the open Beckn protocol, so they can exchange orders and updates.
• Seller choice: A store can choose its seller app and, often, its delivery partner, and can switch apps if terms stop suiting it.
• No single storefront: The seller's products appear inside many buyer apps, each with its own design.

How ONDC Works

1. The seller joins through a seller app: The kirana owner picks an ONDC seller app, completes verification with GST or other required details and a bank account, and uploads a catalogue with prices and stock.
2. The catalogue enters the network: The seller app publishes the store's products, delivery area and timings to the network.
3. A shopper searches on a buyer app: Someone in Gomti Nagar searches for "atta 5 kg" on a buyer app that has joined ONDC.
4. The network finds matching sellers: The search reaches seller apps whose sellers serve that area, and matching products appear in the buyer app.
5. The order and payment are placed: The shopper orders and pays in the buyer app, often by UPI, and the order passes to the kirana store's seller app.
6. Delivery and settlement follow: A logistics partner on the network picks up the order, and money is settled to the seller after agreed fees.

Example: ONDC for a Lucknow Kirana Store

• Pick a seller app: The owner compares seller apps on fees, ease of catalogue upload in Hindi, delivery support and payout timelines before choosing one.
• Build a clean catalogue: Products get clear names with brand and pack size, such as the brand followed by "Whole Wheat Atta 5 kg", accurate prices and good photos, following the principles of product feed optimization.
• Set a realistic delivery area: The store serves nearby localities only, where it can deliver reliably within its promised time.
• Keep stock accurate: The owner updates stock and prices every morning so orders are not cancelled.
• Promote locally: The store adds its details to its Google Business Profile through local SEO and tells regular customers they can also find it on ONDC buyer apps.
• Watch ratings: Quick acceptance, correct items and polite delivery build ratings that help the store appear more often.

Benefits of ONDC

• Wider reach from one listing: A small store can be discovered on several buyer apps without joining each separately.
• More choice for sellers: The store can choose and change its seller app and delivery partner.
• Potentially lower costs: Competition among apps may keep fees lower than on some closed platforms, though fees vary widely.
• Level playing field: Discovery is designed to be less dependent on one platform's own rules, and closed-platform advertising is covered in what is retail media.

Limitations of ONDC

• Uneven shopper adoption: Many shoppers still use large closed apps, so orders from ONDC can be small at first.
• Experience varies: Each buyer app shows products differently, and service quality depends on several companies working together.
• Operational discipline: Accurate stock, fast acceptance and reliable delivery are the seller's responsibility.
• Faster rivals: In large cities, quick commerce apps deliver in minutes from dark stores, which sets high expectations.

How AI Changes ONDC

What AI Automates Now

Seller apps increasingly use AI to create catalogues from photos or voice notes, translate product names into several Indian languages, and suggest prices. Buyer apps use AI for search and recommendations, and AI agents that shop for customers could use open networks like ONDC to compare sellers, as explained in agentic commerce.

What Still Needs a Human

The owner must choose the seller app, set prices and delivery areas, check every product name and price the AI creates, and handle customers personally when something goes wrong. Relationships with regular customers remain the store's biggest strength.

Risk to Watch

AI-generated catalogues can mislabel pack sizes, brands or prices, which leads to wrong orders and poor ratings. Check every AI-created listing before publishing, especially weights and prices.

Do It with AI

Use this prompt to turn a handwritten or spoken product list into a clean ONDC catalogue; it works in ChatGPT, Claude or Gemini.

1. Write or record the store's product list with prices from the shop's own register.
2. Run the prompt and compare every row with the actual products on the shelf.
3. Upload the checked table to the seller app in the format it requests.
4. Update stock and prices daily, and review the catalogue each month.

Check Before You Use It

• Facts: Every brand, pack size and price must match the product on the shelf and the MRP printed on it.
• Brand fit: Keep product names simple and familiar to local customers, in the language they use.
• Compliance: Follow the seller app's listing rules and legal metrology requirements for showing MRP and net quantity.