The Open Network for Digital Commerce (ONDC) is considering reintroducing ₹100–150 crore in subsidies for food delivery services on its platform. This marks a reversal from its previous pause on financial incentives as the sector faces a slowdown
Who Benefits from the Subsidies?
If approved, major players like Magicpin, Paytm, Ola Consumer, and Waayu can utilize the funds to offer discounts to users. ONDC officials have held discussions with restaurants and delivery firms over the past month to finalize details
Analysts project these incentives could generate 80–100 million additional food orders, providing a significant boost to ONDC’s food delivery segment
Why Subsidies Were Cut and Why They Might Return
Initially, ONDC capped incentives—reducing maximum monthly payouts from ₹3 crore to ₹30 lakh—to scale back aggressive discounting. As a result, retail orders (including food delivery) fell from 6.5 million in October 2024 to 4.1 million by May 2025
Amid declining volumes, ONDC is now weighing subsidies anew to revive growth in its competitive food delivery ecosystem
Broader Market Context
- ONDC has processed over 20 crore cumulative transactions, with food delivery growth lagging behind mobility and logistics segments
- Companies like Magicpin have previously invested in onboarding incentives—like ₹100 crore to onboard restaurants—demonstrating the importance of financial support Business Standard
What This Means for Investors and Users
| Stakeholder | Impact |
|---|---|
| Restaurants | Lower commission rates and increased order volumes |
| End‑Consumers | Access to more discounts and promotions |
| ONDC Ecosystem | Stronger competitiveness against giants like Zomato and Swiggy |
By reviving subsidies, ONDC aims to strengthen stakeholder participation and restore momentum in its food delivery vertical.
Summary
ONDC is planning a ₹100–150 crore subsidy pool, offering discounts through partner platforms like Ola and Paytm to revive food delivery volumes. After earlier incentive cuts led to slowing orders, this subsidy revival aims to reignite growth and competitiveness in the sector.
