Microsoft joins ONDC network, to launch a shopping app in India

Microsoft has become the first big tech company to join Open Network for Digital Commerce (ONDC), an Indian government-backed platform created to provide a level playing field to all e-commerce companies.

Microsoft said that through ONDC it intends to introduce social e-commerce in the Indian market. The company is also planning to launch a shopping app in India, which will be available on the ONDC network allowing users to discover the best price offered by retailers and sellers. 

India’s e-commerce market has seen unprecedented growth, especially after the Covid-19 pandemic which forced businesses to sell and customers to buy online. The Indian e-commerce sector is projected to grow at a compound annual growth rate (CAGR) of 19.24% from $46.20 billion in 2020 to $111.40 billion by 2025, according to an August report by the Indian Brand Equity Foundation (IBEF).  

ONDC is being seen by many as the game changer, given its UPI-like network for digital commerce. “It is a win-win for both buyers and sellers as it will enable them to connect without dependency on any e-commerce solution,” a Microsoft spokesperson said in a statement.  

T. Koshy, managing director, and chief executive of ONDC, pointed out that Microsoft can implement its creative ideas like social commerce faster using the strength of ONDC’s open network users. 

“Joining hands with Microsoft is a testament to our credibility to foster an open e-commerce ecosystem with numerous possibilities,” Koshy added. 

Large e-commerce players have helped smaller merchants and businesses to digitise their inventory and sell online. For instance, in May Amazon announced that it has digitised over 40 lakh Micro, Small & Medium Enterprises (MSMEs) and created over 11.6 lakh direct and indirect jobs in the last nine years.  

However, there are also concerns that companies such as Amazon are using their dominant position for anti-competitive practices. For instance, Amazon is being investigated in the UK for giving an unfair advantage to its own retail business and sellers that use its services at the expense of third-party merchants.