As part of its entry into the fintech space, the government-backed Open Network For Digital Commerce (ONDC) facilitated its first mutual fund transaction on the network on͏͏ Tuesday͏͏ (October͏͏ 1).
Collaboration͏͏ with͏͏ Nippon͏͏ India͏͏ Mutual͏͏ Fund:
In͏͏ a͏͏ LinkedIn͏͏ post,͏͏ Hrushikesh͏͏ Mehta,͏͏ ONDC’s͏͏ Senior͏͏ VP͏͏ of͏͏ Financial͏͏ Services,͏͏ stated͏͏ that͏͏ the͏͏ first͏͏ transaction,͏͏ amounting͏͏ to͏͏ INR͏͏ 100,͏͏ was͏͏ conducted͏͏ in͏͏ partnership͏͏ with͏͏ asset͏͏ management͏͏ company͏͏ Nippon͏͏ India͏͏ Mutual͏͏ Fund͏͏ and͏͏ online͏͏ trading͏͏ platform͏͏ Appreciate.
Expanding͏͏ Mutual͏͏ Fund͏͏ Offerings:
Emphasising͏͏ ONDC’s͏͏ intention͏͏ to͏͏ expand͏͏ its͏͏ mutual͏͏ fund͏͏ offerings͏͏ throughout͏͏ India,͏͏ Mehta͏͏ mentioned͏͏ that͏͏ investment͏͏ platforms͏͏ ATX͏͏ Labs͏͏ and͏͏ AssetPlus͏͏ will͏͏ soon͏͏ join͏͏ the͏͏ network͏͏ as͏͏ buyer͏͏ apps.͏͏ He͏͏ also͏͏ noted͏͏ that͏͏ more͏͏ asset͏͏ management͏͏ companies͏͏ are͏͏ expected͏͏ to͏͏ offer͏͏ mutual͏͏ funds͏͏ on͏͏ the͏͏ network͏͏ in͏͏ the͏͏ future.
“Seventy-five͏͏ percent͏͏ of͏͏ mutual͏͏ fund͏͏ AUM͏͏ is͏͏ concentrated͏͏ in͏͏ the͏͏ top͏͏ 30͏͏ cities͏͏ in͏͏ India.͏͏ Our͏͏ aim͏͏ is͏͏ to͏͏ shift͏͏ this͏͏ balance͏͏ by͏͏ promoting͏͏ mutual͏͏ fund͏͏ product͏͏ adoption͏͏ beyond͏͏ these͏͏ urban͏͏ areas.͏͏ After͏͏ 18͏͏ months͏͏ of͏͏ effort,͏͏ we͏͏ have͏͏ taken͏͏ the͏͏ first͏͏ step͏͏ towards͏͏ transforming͏͏ our͏͏ nation͏͏ from͏͏ savers͏͏ to͏͏ investors,”͏͏ the͏͏ post͏͏ stated.
Continue͏͏ Exploring:͏͏ ONDC to͏͏ unveil͏͏ insurance͏͏ and͏͏ mutual͏͏ fund͏͏ solutions͏͏ in͏͏ the͏͏ next͏͏ two͏͏ months
With͏͏ this͏͏ initiative,͏͏ ONDC͏͏ aims͏͏ to͏͏ make͏͏ mutual͏͏ fund͏͏ investments͏͏ more͏͏ accessible͏͏ to͏͏ a͏͏ wider͏͏ audience͏͏ through͏͏ its͏͏ network.͏͏ Mehta͏͏ mentioned͏͏ that͏͏ the͏͏ network’s͏͏ financial͏͏ division͏͏ has͏͏ been͏͏ developing͏͏ the͏͏ product͏͏ for͏͏ the͏͏ past͏͏ 18͏͏ months.
ONDC’s͏͏ intentions͏͏ to͏͏ enter͏͏ the͏͏ mutual͏͏ fund͏͏ transactions͏͏ market͏͏ were͏͏ announced͏͏ by͏͏ MD͏͏ and͏͏ CEO͏͏ T.͏͏ Koshy͏͏ in͏͏ August.͏͏ He͏͏ stated͏͏ that͏͏ the͏͏ network͏͏ planned͏͏ to͏͏ launch͏͏ the͏͏ offering͏͏ in͏͏ September,͏͏ targeting͏͏ 100-200͏͏ transactions.
In͏͏ August͏͏ this͏͏ year,͏͏ ONDC͏͏ initiated͏͏ its͏͏ fintech͏͏ expansion͏͏ with͏͏ the͏͏ launch͏͏ of͏͏ credit͏͏ offerings.͏͏ Through͏͏ this͏͏ initiative,͏͏ customers͏͏ using͏͏ the͏͏ network͏͏ via͏͏ Easypay,͏͏ Paisabazaar,͏͏ Tata͏͏ Digital,͏͏ Invoicepe,͏͏ Cliniq360,͏͏ Zyapaar,͏͏ Indipe,͏͏ Tyreplex,͏͏ and͏͏ PayNearby͏͏ can͏͏ obtain͏͏ fully͏͏ digital͏͏ and͏͏ paperless͏͏ loans͏͏ in͏͏ just͏͏ six͏͏ minutes.
Launched͏͏ in͏͏ 2021,͏͏ ONDC͏͏ is͏͏ an͏͏ initiative͏͏ by͏͏ the͏͏ Department͏͏ for͏͏ Promotion͏͏ of͏͏ Industry͏͏ and͏͏ Internal͏͏ Trade͏͏ (DPIIT)͏͏ under͏͏ the͏͏ Ministry͏͏ of͏͏ Commerce͏͏ and͏͏ Industry.͏͏ Its͏͏ goal͏͏ is͏͏ to͏͏ promote͏͏ open͏͏ networks͏͏ for͏͏ the͏͏ exchange͏͏ of͏͏ goods͏͏ and͏͏ services͏͏ via͏͏ digital͏͏ or͏͏ electronic͏͏ platforms.͏͏ ONDC͏͏ claims͏͏ to͏͏ be͏͏ operational͏͏ in͏͏ over͏͏ 611͏͏ cities͏͏ with͏͏ 111͏͏ network͏͏ participants.
Since͏͏ its͏͏ inception,͏͏ the͏͏ network͏͏ has͏͏ aimed͏͏ to͏͏ democratise͏͏ the͏͏ e-commerce͏͏ ecosystem͏͏ in͏͏ India.͏͏ However,͏͏ venturing͏͏ into͏͏ the͏͏ uncharted͏͏ fintech͏͏ space͏͏ has͏͏ been͏͏ a͏͏ long-standing͏͏ goal͏͏ for͏͏ the͏͏ govt-backed͏͏ network.
In͏͏ June͏͏ of͏͏ last͏͏ year,͏͏ Koshy͏͏ mentioned͏͏ that͏͏ the͏͏ network͏͏ had͏͏ formed͏͏ a͏͏ working͏͏ committee͏͏ made͏͏ up͏͏ of͏͏ fintech͏͏ industry͏͏ experts͏͏ to͏͏ establish͏͏ a͏͏ standard͏͏ protocol͏͏ for͏͏ onboarding͏͏ and͏͏ integrating͏͏ sellers͏͏ and͏͏ industry͏͏ participants.
Future͏͏ Loan͏͏ and͏͏ Insurance͏͏ Plans:
Currently,͏͏ the͏͏ network͏͏ plans͏͏ to͏͏ provide͏͏ unsecured͏͏ GST-based͏͏ invoice͏͏ loans,͏͏ unsecured͏͏ purchase͏͏ financing,͏͏ and͏͏ unsecured͏͏ working͏͏ capital͏͏ lines.͏͏ Additionally,͏͏ it͏͏ aims͏͏ to͏͏ enter͏͏ the͏͏ insurance͏͏ sector͏͏ with͏͏ offerings͏͏ such͏͏ as͏͏ health͏͏ insurance,͏͏ motor͏͏ insurance,͏͏ and͏͏ life͏͏ insurance.
