Uber has signed a memorandum of understanding with an Indian government-backed firm that aims to make mobility and commerce more accessible across the South Asian nation.
The ride-hailing giant said Thursday that it will explore an integration with Open Network for Digital Commerce (ONDC) to explore integrations with the network and expand range of its mobility offerings on the Uber app. At an event in Bengaluru, Uber chief executive Dara Khosrowshahi said Uber “views open source tech stacks with a lot of interest and recognizes the opportunities they bring 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 a platform for every Indian’s daily mobility needs,” added Prabhjeet Singh, president of Uber India and South Asia, in a statement.
Uber and ONDC did not confirm any specific details of the partnership. However, TechCrunch has exclusively learned that Uber will initially integrate into the ONDC network for intercity bus ticketing and metro rail ticketing as a buyer application.
The ONDC is an ambitious initiative seeking 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 to the mobility sector.
Even as ONDC is making inroads, one of the major challenges the initiative has faced is the lack of participation from big names. Though firms like Amazon and Flipkart have expressed intentions to participate in the open network, their engagement remains limited for now.
“As the Open Network is continuously evolving, MTT (mobility, transport and travel) is certainly a critical sector for us. Different players together on the network foster innovation and newer business models,” said T Koshy, managing director and CEO of ONDC, in a statement. “Today’s MoU is a major step forward and one we hope will enable a diverse range of mobility solutions to benefit every Indian.”
Alongside looking to attract big companies, ONDC is working on making the network self-sustained. Koshy told TechCrunch in a recent interview that the ONDC board was discussing the model to start charging a marginal fee to some participants.
“It should be very marginal, and it should be against actual business that is happening… It should not put a load on to small entities who are coming up,” he had said, adding that the fee 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 firm, which competes with SoftBank-backed Ola in India, sold UberEats to local delivery giant Zomato in 2020. A cheerful Khosrowshahi joked on Thursday that he might 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.
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