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ONDC to raise prices on all goods, limits seller-side apps’ incentives

New Delhi: Just when consumers were enjoying discounts on Open Network Digital Commerce (ONDC), the platform decided about reducing the incentive it gave to seller-side apps and increase the prices of all goods. The e-commerce space recently informed its seller-side applications of the decrease in delivery cost incentives with immediate effect from May 9, Tuesday. […]

Edited By : Prateek Gautam | Updated: May 11, 2023 11:27 IST
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New Delhi: Just when consumers were enjoying discounts on Open Network Digital Commerce (ONDC), the platform decided about reducing the incentive it gave to seller-side apps and increase the prices of all goods.

The e-commerce space recently informed its seller-side applications of the decrease in delivery cost incentives with immediate effect from May 9, Tuesday.

The ONDC, lately has been getting a lot of positive responses from people, for its user-friendly experience. Social media platforms are burdened with posts comparing prices between the ONDC platform and other delivery apps such as Swiggy and Zomato for their low prices for food delivery.

The effect came due when orders scaled up on ONDC, peaking at 25,000 orders for food and groceries around the weekend, following which the platform handed communication to seller network contributors on May 7, indicating few changes.

Incentive Limit

With the immediate effect of incentive limitation, incentives per seller-side app for each day will be limited to Rs.2,25,000 and Rs.3,750 per seller daily.

As compared to previous times, ONDC used to offer a discount of up to Rs. 75 for logistics on every entitled order.

The reason behind the low prices that were being offered on ONDC was the incentives which had some qualifications, and required the seller-side apps to “send zero delivery charges for all hyperlocal deliveries and subsidised charges for inter-city delivery”. Adding to that, the clause also mentioned relating to ONDC to have expected the “buyer app to communicate free delivery to the buyer as soon as possible in the buyer journey to generate demand”.

What the clause meant by this, was that the consumers were not being charged for delivery for most of the hyperlocal orders, but as of now, this clause has been eliminated on May 9.

What does this mean?

With this immediate effect, consumers will now be paying delivery charges by some eateries and grocery outlets which will apply to sellers that have breached the cap pressed by ONDC.

The variations between ONDC and Swiggy-Zomato which until now went up to 50%-60%, will be reduced.

However, officials from the ONDC have not made a statement, but as per sources, the platform had been thinking of bringing changes in the incentives, as the initial discounts were merely to attract their target market.

Meanwhile, the food items prices available on ONDC will still be priced much lower, as seller apps charge only about 2%-3% commission to the restaurants, whereas the commissions on Zomato and Swiggy range from 20%-30%.

First published on: May 10, 2023 02:26 PM IST

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