ONDC Is Working. Now It Needs the Right Safeguards.
Open-protocol commerce is genuinely transformative, but without oversight it risks the problems it was built to solve.
India's Open Network for Digital Commerce (ONDC) is one of the most interesting policy experiments in digital governance anywhere. Its core insight — that the vertically integrated aggregator model is not inevitable, and that discovery, logistics and payment can be unbundled into interoperable, open-access services — is both powerful and validated in practice. Sellers on ONDC pay transaction fees 30 to 60 per cent lower than on closed platforms.
In thin-margin categories — grocery, local services, small manufacturing — a 40 per cent fee cut can be the difference between a viable business and an unviable one.
Key Points
- ONDC unbundles discovery, logistics and payment into open services.
- Seller fees run 30-60% below closed platforms.
- Scaling has exposed counterfeit listings and grievance gaps.
- Distributed responsibility blurs accountability in disputes.
- An independent ombudsman and quality standards are needed — without recentralising.
Problems Emerging at Scale
As ONDC scales, it meets the complexity of real-world commerce. Two challenges stand out: counterfeit listings and consumer grievance resolution. On closed platforms, one operator owns listing quality and dispute mediation. On ONDC, that responsibility is split across buyer apps, seller apps and the network — creating ambiguity over who is accountable when a shopper receives a counterfeit or cannot return a defective item.
Consumer forums in Delhi and Mumbai have logged disputes where buyers could not identify a responsible party; each app pointed to the other, and the ONDC body has no direct consumer-facing dispute mandate.
Promise and the gap
| Strength | Missing safeguard |
|---|---|
| 30-60% lower seller fees | Independent dispute adjudication |
| Open, interoperable protocol | Unified consumer complaint portal |
| Support for micro-merchants | Minimum seller-onboarding quality standard |
What Governance Is Needed
The answer is not to recentralise. The open protocol should stay. What is needed is an independent Network Ombudsman empowered to adjudicate cross-application disputes, a unified consumer complaint portal with mandatory response timelines, and a minimum seller-onboarding quality standard enforced by every participating app.
None of this abandons the open-protocol design; it is the institutional maturity every market structure needs at scale — the same discipline visible across India's maturing startup market and quick-commerce sector. ONDC has earned that investment.
Frequently Asked Questions
What is ONDC?
An open network that unbundles e-commerce into interoperable discovery, logistics and payment services.
How much does it save sellers?
Transaction fees run 30-60% below closed platforms.
What problems has scaling exposed?
Counterfeit listings and unclear accountability in consumer disputes.
What safeguards are proposed?
An independent ombudsman, a unified complaint portal and minimum onboarding standards.
Would this undo the open model?
No. The safeguards preserve the open protocol while adding accountability.
Sources
- Studies on ONDC seller transaction costs
- Consumer dispute forum records, Delhi and Mumbai