Walmart-backed digital payments company PhonePe, has launched a separate app ‘Pincode’ on the Open Network for Digital Commerce (ONDC) platform. The app will be available to Bengaluru users with hyperlocal shopping offerings in food, grocery, electronics, pharmacy, fashion, and home decor categories. The company aims to reach a daily 1 lakh orders size by the end of 2023. The new app aims to connect digitised neighborhood stores and bring the small merchant ecosystem into the digital shopping fold through ONDC’s reduced barriers. With nearly 450 million registered users on the PhonePe app, the company has strategically opted to launch a new app instead of integrating it into the existing one. 

Sameer Nigam, CEO and founder PhonePe, primarily counts two reasons to go the separate way. One, on a new platform like ONDC and experimenting in just one city for the time being,  would provide them with greater control than opening the services on an pan India app. Two, the confidence that the app by itself would drive volumes and any changes or tweaks required to the app could be brought about more easily/agility than having it on an integrated platform. 

The proposition that Pincode app looks at providing is shopping options based on geography that is within the neighborhood, and not around long distance deliveries. “This is local, we hope in categories like groceries and pharmacy, if it turns out well, 80% of the delivery will be done by the storekeeper themselves. In categories like food, the hyperlocal logistics players will come in,” says Sameer.

According to PhonePe, the foray into ecommerce space under the ONDC umbrella is an opportunity that the company couldn't afford to miss. As ONDC expands the consumer base for a seller, the company looks to expand Pincode to the top 10 cities in the first year of its operation. While the first effort would be to digitise the sellers' catalog, “the next level is to increase the number of sellers in the category we are in, and then the cities, exactly the opposite of UPI,” says Sameer. The company also says that it would eventually also look at the mobility space by leveraging ONDC.

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