Uber has signed a memorandum of understanding with an Indian government-backed company aimed at making mobility and commerce more accessible across the South Asian nation.
The ride-hailing giant said Thursday it will explore an integration with the Open Network for Digital Commerce (ONDC) to explore integrations with the network and expand the range of its mobility offerings on the Uber app. At an event in Bengaluru, Uber CEO Dara Khosrowshahi said Uber “views open source technology stacks with great interest and recognizes the opportunities they offer for everyone.”
“We are excited to take our first step through this MoU with ONDC to explore how we can accelerate our ambition to make Uber the platform for every Indian’s daily mobility needs,” added Prabhjeet Singh, President, Uber India and South Asia, in a statement. .
Uber and ONDC did not confirm specific details of the partnership. However, TechCrunch has exclusively learned that Uber will initially be integrated into the ONDC network for intercity bus and metro train ticketing as a buyer app.
ONDC is an ambitious initiative that seeks to disrupt the country’s fast-growing e-commerce and mobility sectors. Launched in 2021, ONDC aims to democratize online commerce by providing an open platform that can connect buyers and sellers across markets, allowing even small retailers to reach customers more easily. Last year, ONDC expanded into the mobility sector.
Although ONDC is making inroads, one of the biggest challenges the initiative has faced is the lack of big name participation. Although companies like Amazon and Flipkart have expressed their intentions to join the open network, their commitment remains limited for now.
“As the Open Network continues to evolve, MTT (mobility, transport and travel) is certainly a critical area for us. Different players together in the network are driving innovation and newer business models,” T Koshy, managing director and chief executive officer of ONDC, said in a statement. “Today’s MoU is an important step forward and will hopefully enable a variety of mobility solutions to benefit every Indian.”
Along with attracting large companies, ONDC is working to make the network self-sustaining. Koshy told TechCrunch in a recent interview that ONDC’s board was discussing the model to start charging a marginal fee to some participants.
“It should be very marginal and it should be against the real business that is happening… It should not burden the small entities that come in,” he said, adding that the procurement model would be finalized in a month and announced in a few months.
India is a key market for Uber, where it continues to expand its offerings. The company, which competes with SoftBank-backed Ola in India, sold UberEats to local delivery giant Zomato in 2020. A jubilant Khosrowshahi joked on Thursday that he may explore re-entering the food delivery business in the country.
India is one of the toughest markets out there, he said. “The Indian customer is so demanding and doesn’t want to pay for anything,” he added.
