First, a correction the headline forces: ONDC is not an app, so ONDC vs Amazon is not quite a fair fight. ONDC is a government-backed open protocol, the rails, while Amazon and Flipkart are full platforms, the trains running on their own private tracks. 

Author: Aditya Pareek | EQMint

The real question is whether open commerce rails can loosen the grip of the Amazon-Flipkart duopoly, which still holds around 83% of Indian e-commerce against ONDC’s roughly 4.3%. The honest 2026 answer is split: ONDC is genuinely winning in mobility, where rides now make up about 56% of its volume, and clearly struggling in retail, where orders fell sharply through 2025 and big buyer apps like PhonePe’s Pincode shut down. 

So open networks aren’t simply winning or losing. They’re winning where transactions are simple and stumbling where they’re complex.

The UPI comparison everyone reaches for is seductive and partly misleading. UPI won because it solved a real, felt consumer pain. Much of ONDC’s retail push tries to solve a problem most shoppers don’t actually feel.

Here’s the honest breakdown of ONDC against the incumbents, where open commerce is working, where it isn’t and whether it can actually win.

What ONDC actually is, and isn’t

Clear this up first, because most of the confusion lives here. ONDC, the Open Network for Digital Commerce, is a set of open protocols built on the Beckn standard, launched by the government in 2021 to unbundle e-commerce into interoperable pieces.

The idea is that a buyer on one app could discover and buy from a seller on a completely different app, with a third company delivering and a fourth handling payment, all through shared rails. No single company owns the whole journey. It’s pitched as the UPI of commerce, a public digital good rather than a platform.

So you don’t open ONDC the way you open Amazon. There’s no ONDC storefront. You use a buyer app (Paytm, or others) that plugs into the network. That structural difference is exactly why comparing ONDC to Amazon as if they’re rival apps misses the point, and also why ONDC has struggled to build a consumer identity people recognise and trust.

The incumbents, and why they’re hard to beat

Be honest about the strength of what ONDC is up against. Amazon and Flipkart didn’t win by accident, and a third force, Reliance, makes the battlefield even harder.

The duopoly commands roughly 83% of organised e-commerce, built over years with billions in capital, tightly integrated systems and perfected logistics, returns and customer service. Amazon announced a further 35 billion dollar India investment through 2030. 

Flipkart and Amazon are racing into quick commerce with hundreds of dark stores. And Reliance’s JioMart, leveraging 18,000-plus physical stores, plus Tata Neu’s super-app, mean the incumbent side is not standing still. These platforms own the end-to-end experience, which is precisely what makes it reliable.

Their weakness is the opening ONDC aims at: they charge sellers 15% to 30% or more in commissions, control the data, and favour their own listings. That’s the structural unfairness open rails are built to attack.

Where ONDC is genuinely winning

Take the position the cynics miss. ONDC is not failing across the board. In the right category, it’s working well, and that category is mobility.

Rides now account for around 56% of ONDC’s volume, up sharply, driven by apps like Namma Yatri and Ola. The reason is structural and instructive. A ride has no inventory, no returns, no refunds, no packaging and no post-sale service. 

It’s a simple, instant, one-step transaction, exactly the kind a decentralised network handles cleanly. Drivers also benefit directly, keeping far more of the fare than aggregator commissions allowed, which gives the supply side a real reason to join.

This is the genuine success story, and it points to where open networks can win: high-frequency, low-complexity transactions where the platform middleman adds cost without adding much value. Logistics is growing on ONDC for similar reasons.

Where ONDC is clearly struggling

Be equally honest about the failures, because they’re real and revealing. Retail commerce, the original headline ambition, has stumbled.

Retail orders fell from around 6.5 million in October 2024 to 4.6 million by February 2025, and retail’s share of ONDC volume collapsed from 47% to 29%. PhonePe shut its ONDC-powered Pincode app, Paytm scaled back its food-delivery push, and several buyer apps quietly retreated once subsidies dried up. ONDC cut per-app incentives from 2.5 crore to 30 lakh, and the subsidy-driven growth deflated with them.

Why retail struggles on ONDC	The consequence
Many moving parts, no single owner	When something breaks, nobody owns the fix
Clunky UI, weak customer service	Users drift back to Amazon and Swiggy
No single consumer pain to solve	Shoppers feel no reason to switch
Fragmented dispute resolution	Refunds and complaints fall through cracks
Subsidies cut, no cash to burn	Growth that was incentive-led deflated

The core problem is complexity. A product order is a long chain, inventory, listing, delivery, cancellation, refund, support, and ONDC splits that chain across different companies. When it works it’s seamless. When it breaks, no single player owns the resolution, and in a market where clean execution wins, that fragmentation is a serious flaw.

The UPI comparison, and why it only half holds

Everyone calls ONDC the UPI of commerce. It’s worth examining honestly, because the parallel is both the source of the optimism and the reason for the disappointment.

Where it holds: both are open, interoperable public rails meant to break private gatekeeping, and both faced early scepticism. UPI took years to mature, so judging ONDC too early would be unfair, and India has a real track record of infrastructure that stumbled before it soared, Aadhaar and UPI included.

Where it breaks down: UPI solved a sharp, universal pain, moving money was clunky, slow and fragmented, so a better rail spread fast. Commerce is different. Amazon, Flipkart, Swiggy and Zomato already deliver fast, reliable, discounted service. There’s no burning consumer agony for ONDC to relieve on the buyer side.

 

The pain ONDC addresses is the seller’s (high commissions, data control), not the shopper’s, and you can’t build a consumer network on a problem consumers don’t feel. That asymmetry is why mobility, where drivers feel real pain, works better than retail, where shoppers feel none.

So will open networks actually win?

Take a clear, honest position rather than a slogan. Open networks will partly win, in specific places, over a long horizon, and they will not simply replace Amazon and Flipkart any time soon.

The most likely outcome is coexistence, not conquest. ONDC reshapes the economics at the edges, thriving in simple, high-frequency categories like mobility and logistics, pressuring incumbent commissions, and quietly becoming plumbing that even Amazon and Flipkart plug into. 

Notably, Flipkart’s logistics arm Ekart has already joined the network. The future looks less like ONDC defeating the giants and more like open rails running underneath a market the giants still dominate on the surface.

The honest verdict for 2026. ONDC is neither the revolution its boosters promised nor the failure its critics declare. It’s a long, uneven infrastructure bet that is genuinely working in mobility, genuinely struggling in retail, and still years from its real test. 

Whether it wins depends on fixing trust, dispute resolution and user experience, and on patience, the same patience UPI needed. Bet against it entirely and you ignore mobility. Believe the hype wholesale and you ignore the retail numbers. The truth, as usual, sits in between.

FAQ

Is ONDC the same as Amazon or Flipkart?

No. ONDC is a government-backed open protocol, the rails for commerce, not a shopping app. Amazon and Flipkart are full platforms that own the entire buying journey. You access ONDC through buyer apps that plug into the network.

What share of e-commerce does ONDC have?

Around 4.3% as of recent data, against the roughly 83% held together by Amazon and Flipkart. ONDC’s penetration in retail commerce remains modest despite full government backing.

Why is ONDC succeeding in mobility but not retail?

Rides are simple, with no inventory, returns or refunds, which suits a decentralised network. Retail involves a long chain of inventory, delivery, refunds and support split across companies, so when something breaks no single player owns the fix.

Is ONDC failing?

Not overall. Retail orders fell sharply through 2025 and some buyer apps like PhonePe’s Pincode shut down, but mobility surged to around 56% of ONDC volume. It is struggling in complex categories and working in simple ones.

Is ONDC really the UPI of commerce?

Partly. Both are open public rails meant to break private gatekeeping. But UPI solved a real consumer pain, while ONDC mostly addresses the seller’s problem of high commissions, not a pain shoppers feel, which makes consumer adoption harder.

Will ONDC replace Amazon and Flipkart?

Unlikely in the near term. The more probable outcome is coexistence, with ONDC thriving in simple categories, pressuring commissions and becoming plumbing that even the incumbents plug into, while the giants still dominate the surface.

Why do sellers prefer ONDC?

ONDC charges near-zero or negotiated commissions compared with the 15% to 30% or more that Amazon and Flipkart charge, and it gives sellers more control over data and listings. The pain ONDC solves is mainly the seller’s, not the buyer’s.

How can I use ONDC?

You use a buyer app that connects to the ONDC network, such as Paytm, rather than an ONDC app itself. The app shows you sellers across the network, and different companies may handle discovery, delivery and payment.

EQMint is not a SEBI registered investment adviser. This article is for informational purposes only and is not investment advice. Market shares, transaction figures and company positions change quickly, and company names are used only to illustrate the landscape. Verify current data before relying on it.

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