With an aim to enter the ride-hailing market, Paytm is deploying the Open Network for Digital Commerce (ONDC) to introduce auto-rickshaw services in major cities including Bangalore, Chennai, and Delhi.

It is believed that the digital payments platform intends to be on competitive grounds with Ola and Uber on the market.

The new ride-hailing feature is said to allow only a certain amount of users to access it on the Paytm app, which is currently being tested.

The Paytm app notifies customers that the feature is ‘Powered by Namma Yatri’, the seller-side platform for these transactions, when they book an auto-rickshaw ride. The Juspay-backed platform also oversees a number of ride-hailing apps on ONDC that are accessible to consumers.

Offered on the Paytm app, the new feature is supplied by Pai Platforms, a company that was known as Paytm Ecommerce.

On the ONDC platform, the digital payments platform is observed to have grown its footprint in the recent years by launching services across e-commerce categories, such as groceries, electronics, fashion, and food delivery.

There is a separate ONDC page on the Paytm app for users to purchase groceries, meals, and other products. This tab contains the auto-rickshaw ride booking option.

Almost two-thirds of the 50 million orders that ONDC executed between January 2023 and March 2024 involved mobility transactions made possible by partners like Namma Yatri.

Grocery orders made up 4.5 percent and food and drink orders nearly 10 percent of the over 3.6 million non-mobility orders in March 2024.

In the meantime, Bhavesh Gupta, the company's president and chief operating officer (COO), has resigned, according to a regulatory filing the company made on May 4.

Apart from Paytm, other sizable new-age enterprises have experimented with ONDC to provide mobility or commerce services, such as Shiprocket for seller onboarding, PhonePe for e-commerce, and Ola for food delivery.