ONDC enters credit market; aims to expand financial services product basket

The Open Network for Digital Commerce (ONDC) today launched unsecured digital loans on its platform, through which it claims to pass loans within six minutes, the company said in a press conference in Mumbai today.

The buyer applications include Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, Zyapaar, Indipe, Tyreplex and Paynearby. The lenders include Aditya Birla Finance, DMI Finance and Karnataka Bank.

To deliver the loan digitally within minutes, the entire sanction credit process has been integrated using four digital public goods — Account Aggregator for data, Digilocker or Aadhaar for KYC, eNACH or eMandate for repayment and Aadhaar eSign for agreement signing.

The company said there is a strong pipeline of buyer applications with interest in expanding this digital credit model, such as Mobikwik, Rupeeboss and Samridh.ai, and lenders such as HDFC Bank, IDFC First Bank, Faircent, Pahal Finance, Fibe, Tata Capital, Kotak Mahindra Bank, Axis Finance, FTCash and Central Bank of India.

Following the launch of unsecured loans, ONDC now plans to introduce GST invoice financing loans by September, 2024. Subsequent products will include purchase financing for individuals and sole proprietors, as well as working capital lines for partnerships and private limited companies.

Hrushikesh Mehta, SVP- financial services, ONDC said, “We are starting with working capital, then we will have purchase financing, B2B credit, post that we can have credit cards,” he said, adding that the Mastercard network has voluntarily agreed to partner with ONDC on credit cards. “If we are able to launch all of these over the next 18 months, we’ll have full suite of financial offerings,” Mehta said.