Monday, June 27, 2022

Google said in talks to join open e-commerce network ONDC

Google’s talks with the Indian government follow the success of its payments business on ONDC UPI to integrate its shopping services with the country’s open e-commerce network, the government’s initiative for financial transactions

Google’s talks with the Indian government follow the success of its payments business on ONDC UPI to integrate its shopping services with the country’s open e-commerce network, the government’s initiative for financial transactions

Alphabet Inc.’s Google is in talks with the Indian government to integrate its shopping services with ONDC, the country’s open e-commerce network, two sources familiar with the matter told Reuters.

India soft-launched its Open Network for Digital Commerce (ONDC) late last month as the government tries to end the dominance of US companies Amazon.com and Walmart in the fast-growing e-commerce market.

The government estimates that the Indian e-commerce market was worth over $55 billion in gross merchandise value in 2021 and will grow to $350 billion by the end of this decade.

ONDC CEO T. Koshy told Reuters that Google was one of several companies it was in discussions with to be associated with the project.

Google’s talks follow the success of its payments business due to the Unified Payments Interface (UPI), the government’s initiative for financial transactions, said one of the sources, who declined to be identified as they discussed the matter. were not authorized to do so. Media.

Google’s existing Shopping business operates entirely as an aggregator of online listings and does not perform any order fulfillment like delivery, which the likes of Amazon do.

A Google spokesperson declined to comment on whether it was in talks with the government.

Referring to its payments service, the spokesperson said, “We are committed to focusing on enabling small and medium businesses to leverage digital for deep search and payments capabilities with Google Pay.”

Partners of the ONDC project, which currently includes Indian fintech firm Paytm, will show listings from each other on their platforms in search results. The government aims to level the playing field by reducing the cost of doing business for any seller who wants to list their products online.

However, some industry executives have raised concerns on how the listing of different sellers will be prioritized.

“The argument would be that the highest seller/best rated seller will probably appear first, which means it will not be a level playing field,” said Mahesh Narayanan, former head of Google’s mobile advertising business in India.

The ONDC program aims to cover 30 million sellers and 10 million merchants online, and cover at least 100 cities and towns by August.

Cesar Sengupta, chief executive of fintech startup Arbo Works, which was instrumental in setting up Google Pay in India, said he sees great potential with ONDC.

“ONDC will definitely need a consumer player that drives adoption along with the masses,” he said. “You will remember that before Google Pay was launched UPI had only 17 million transactions per month and the graph after that is a hockey stick.”

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