Razorpay announces integration with government-backed ONDC

Fintech major Razorpay announced it will join government-backed ecommerce network Open Network for Digital Commerce (ONDC).

The Bengaluru-based payments solution startup said it will provide payment reconciliation services to network participants such as buyers, sellers and logistic partners to streamline the payment processes on ONDC.

Razorpay said it aims to facilitate ease of transacting on ONDC by timely routing of settlement information for a given transaction and assisting network participants (NPs) in settling funds.


Settling disputes and discrepancies

The Tiger Global-backed company said its solution, which validates transactions and maintains audit trails to support documentation, helps in settling any dispute or discrepancy that may arise.

“...we’re really excited to support the government in this shared vision of democratising e-commerce through the ONDC platform and helping Indian SMEs and Kirana store owners reap the benefits of digital commerce. I believe the possibilities the ONDC network provides are endless and I’m confident the Payment Reconciliation Service will only further strengthen the development of ONDC’s tech infrastructure and help the ecosystem grow seamlessly from a payments and compliance point of view,” said Shashank Kumar, managing director & cofounder, Razorpay.

Razorpay’s entry to the ONDC comes weeks after another major fintech player, PhonePe, integrated with the network, though through a separate dedicated app, called Pincode.

“We are thrilled to welcome Razorpay to ONDC. This is a significant step towards our goal of enabling seamless and secure digital commerce for everyone. With this addition, we continue to drive transparency and inclusion in the digital commerce space and we look forward to working with Razorpay towards achieving this vision,” said Thampy Koshy, CEO of ONDC.

The Sequoia-backed fintech company was adjudged Startup of the Year at the 2022 ET Startup Awards.

Big potential

According to a report by McKinsey, the government-backed ONDC has the potential to increase India’s digital consumption by five times, to around $340 billion, by 2030,.

The network is currently undertaking 5,000 to 6,000 retail orders per day and more than 25,000 mobility transactions every day.

ONDC went beta live in some pin codes of Bengaluru on September 30, and has since expanded to several cities. Apart from Bengaluru, Meerut is also in the beta stage. More than 240 cities and towns are in the alpha stage (the first stage of software testing, done internally).

The network has 46 live participants, of which 12 are buyers, 27 are sellers, and seven are logistics service providers.