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Paytm To Offer Auto-Rickshaw Booking Service: A New Challenger To Ola & Uber?

Paytm has begun testing auto-rickshaw booking service on its app thats reliant on ONDC and is powered by the Namma Yatri service.

Paytm has been entering new markets for the past few years now and latest one for the payments is the market for ride-hailing services, where the app has begun offering booking services for auto-rickshaw in select cities of India. The new service is a part of the Government’s initiative called ONDC.

According to a Moneycontrol report, the company is entering the ride-hailing market offering auto-rickshaw rides in cities like Delhi, Bengaluru and Chennai through the Open Network for Digital Commerce (ONDC). The feature, which is still undergoing testing and is only visible to a small number of Paytm users, is poised to challenge the dominance of Ola and Uber in the ride-hailing space, according to the report.

What is ONDC?

ONDC stands for Open Network for Digital Commerce, a place where restaurants are allowed to sell their food directly to the consumers. Moreover, it also delivers groceries, home décor, cleaning essentials, etc, much like Swiggy’s Instamart, Zepto, and Blinkit. As the platform has been developed by the Government of India, it is pretty reliable as well. While the services first began in Bengaluru back in 2022, the platform can now be used in multiple cities to order food and various other products.

How Is Paytm Offering Auto-Rickshaw Booking?

In the last two years, Paytm has increased its reliance on ONDC for various e-commerce categories, including food delivery, groceries, fashion and electronics. “There is a lot of software testing and integration that goes into each rollout. There is no reason why Paytm will not also get into cab bookings like Ola and Uber as well at a later stage,” said a person close to the developments, per the Moneycontrol report.

The ONDC features on the Paytm app are operated by a separate entity called PAI Platforms. While the fintech company does not own any stake in this entity, it is supported by Paytm founder and chief Vijay Shekhar Sharma. While being dependent on ONDC, Paytm says the feature is ‘Powered by Namma Yatri’ when one tries to book an auto.

What is Namma Yatri?

For those unaware, Namma Yatri is a ride-hailing app that allows users to book rides directly to the driver without commission or middlemen. The app is designed to be fast, easy, and safe, with door-step pickups by trusted drivers. Namma Yatri is available in Bengaluru, Hyderabad, Delhi, Chennai, Mysuru, and Tumkur. This means that Paytm has become another source for booking such auto rides for the Namma Yatri app.

Namma Yatri acts as an open mobility initiative. Open mobility is an open network where any mode of transport can contribute to provide services to commuters thereby removing the dependency on any third party organisations, such as Ola and Uber. The common network standards allows for interoperability for any buyer app compliant with the network standards to offer rides. The network allows for all forms of mobility operators ranging from auto rickshaws, taxis and public transport to coexist.

Namma Yatri has enabled 3.73 crore rides in 7 cities in the last couple of years, including Bengaluru, Delhi, Kolkata and other metros. However, majority of these were auto rides, and the company is also starting cab bookings across cities as it closes in on its Series A round of $10-15 million.

Namma Yatri makes money on these trips through a subscription model for drivers and does not charge any per-ride commission. But, sources told Moneycontrol that buyer-side apps could charge the seller apps a fee per ride for finding customers.

Instead of building its own network, Paytm is relying on Namma Yatri and ONDC for offering its auto-rickshaw booking service which not only saves it various costs but also makes it reliable for consumers to choose the platform as it’s backed by a government initiative. It won’t come as a surprise if Paytm also extends the booking service beyond autos, to cabs and other shared cab services in the near future.

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