PhonePe-Owned Pincode Exits Fashion, Grocery Categories On ONDC

SUMMARY

PhonePe’s ecommerce app Pincode will no longer offer services in categories like fashion, grocery and electronics on ONDC

Pincode will only offer food delivery services on the government-backed network, while the PhonePe app will only provide ticket booking through ONDC

Sub-par customer experience on Pincode app as compared to other consumer delivery apps for these categories is said to be the reason behind the company’s move

A year after fintech major phonepe launched Pincode on the Open Network for Digital Commerce (ONDC), the ecommerce app is exiting several categories like fashion, grocery and electronics from the network.

Effective Tuesday (April 23), Pincode will only offer food delivery services on the government-backed network, while the PhonePe app will only provide ticket booking through ONDC, The Economic Times reported.

“PhonePe Payment Technology Services Private Limited (Pincode) has requested ONDC to remain subscribed only to Food and Unreserved ticket booking domains on the ONDC registry, taking a view to join the other domains after re-aligning their internal approach,” the publication quoted an internal ONDC note as saying.

“Accordingly, with effect from 23rd April 2024, Pincode will be unsubscribed from the other domains, except Food and Unreserved ticket booking,” the note said.

While PhonePe did not respond to Inc42’s queries on the issue, sources at the company confirmed the development with Inc42.

It’s pertinent to note that PhonePe initially launched Pincode app in Bengaluru in April 2023 to sell locally manufactured groceries, pharma, apparel, food and technology products on the ONDC platform.

In July last year, Pincode was rolled out in 10 Indian citiesincluding Mumbai, Delhi, Noida, Gurugram, Chennai, Hyderabad, Ahmedabad, Pune and Kolkata.

PhonePe’s decision to restrict its offerings on ONDC signals that it is realigning its strategy for its ecommerce business. Sub-par customer experience on Pincode as compared to other consumer delivery apps is the reason behind the company’s latest move, ET reported citing sources.

Pincode is an important part of PhonePe’s strategy to expand its offerings. Flush with funds, the company has launched a number of new offerings over the last year or so as it aims to turn into a super app.

Earlier today, it was reported that the Walmart-owned company invested over INR 800 Cr into its subsidiariesincluding PhonePe Insurance Broking Service and PhonePe Wealth Broking, over the last year.

Meanwhile, its Android app marketplace Indus Appstore today launched an AI-powered voice search feature in 10 Indian languages to further expand its base.