Additionally, ONDC intends to launch business-to-business credit services with substantial loans ranging from Rs. 1 to Rs. 1.5 crore.
In the coming months, banks such as HDFC Bank, Karnataka Bank, and IDFC Bank are set to be integrated with the Open Network for Digital Commerce (ONDC), as per the Economic Times. Fintech firms, including Fibe, are also in the process of being integrated.
Unsecured loans and GST invoices will be offered by the banks through this integration process. The target for the same will be small merchants and retailers, according to the report.
Speaking to the Economic Times about this development, IDFC Bank said, “We would like to state that currently IDFC First Bank provides an ONDC network participant account as well as a reconciliation service provider component, which can be integrated with various network participants to reconcile and perform settlement activity.”
Additionally, ONDC intends to launch business-to-business credit services with substantial loans ranging from Rs. 1 to Rs. 1.5 crore. These items, however, are still in the works and will be developed after the consumer and corporate finance sections launch, according to the report.
Speaking to the Economic Times, Hrushikesh Mehta, senior vice president of financial services at ONDC, said, “If you think about MSME (micro, small, and medium enterprises) financing, small-ticket loans for any purpose in remote villages in India haven't been accessible from formal credit institutions. Similarly, insurance is largely limited to tier-1 and tier-2 cities. For mutual funds, it’s a similar story.”
Expanding beyond credit, ONDC is also entering the investment and insurance segments as well. While the platform first offered marine, health, and motor insurance, it is now expanding to life insurance too. Mehta reportedly said that the idea behind it is to make a reasonably basic product accessible so that people can increase their wealth.
EasyPay, Tata Digital, Paisabazaar, DMI Finance, and Aditya Birla Finance are the five players that are available on ONDC now. Additionally, ONDC has also started pilot studies for credit disbursals with Tata Neu, according to the report.