From UPI to ONDC: The role of centralised orchestration in DPI success

Also read: AI can turbocharge Digital Public Infrastructure and unleash benefits at scale: Nandan Nilekani

Infrastructure, Institutions, and Governance: DIGIT

The eGov Foundation's Digital Infrastructure for Governance, Impact & Transformation (DIGIT) platform offers another compelling example of urban governance. DIGIT is a digital infrastructure for municipal administration, offering 13 applications for property tax, sanitation, building permissions, birth and death registration, finance management, and grievance redressal.

By 2024, DIGIT had reached over 3,500 urban local bodies across 16+ states, impacting more than 150 million citizens. However, adoption and usage vary widely by state and municipality. The variance is not technological but institutional: staff training, digital literacy, and administrative incentives are often lacking.

DIGIT's experience underscores a broader insight—technology cannot substitute for institutional capacity. Even a well-built DPI needs alignment across infrastructure, governance capacity, and use-case relevance. Where states invested in training and incentivised usage, results improved. In others, usage remained shallow.

This illustrates that DPI's success in governance depends on aligning digital infrastructure with institutional readiness and governance processes. Orchestration here is top-down and needs lateral and vertical alignment across institutions.

Incentives and Use Cases Drive Broader Ecosystem Participation

Unlike Aadhaar or UPI, bottom-up DPI models like Account Aggregator require greater effort to gain traction. Despite a strong policy framework and 81 financial institutions onboarded as of 2024, AA's user adoption remains low. Banks hesitate to invest in integration, consumers lack awareness, and Fintechs face usage hurdles.

AA's core promise—consumer control over financial data—is futuristic but indirect in its value. Without a pressing use case, users don't flock to it. Future growth depends on its integration into visible applications like loan eligibility, personal finance, or insurance. Until then, the scale will be elusive.

DigiLocker, similarly, has 43.5 crore users and has issued 9.4 billion documents. Yet daily active usage is modest, confined largely to select government departments. The utility is real but sporadic. Without a compelling reason to use it frequently, DigiLocker remains under-leveraged. 

ONDC (Open Network for Digital Commerce) was launched in 2022 to enable decentralised, interoperable e-commerce. By late 2024, it had spanned 600+ cities and 775,000+ sellers, with 14.4 million orders in November alone. Still, much of the traffic is concentrated in limited domains like food and mobility, and buyer experience remains inconsistent across platforms.

ONDC shows that user-side stickiness and consistent quality take time, even with public investment and institutional support. Network effects do not emerge automatically—they must be earned through design, reliability, and perceived value.

India's education sector features DIKSHA as a standout example of a Digital Public Infrastructure. Built on the open-source Sunbird platform, DIKSHA adopts a hybrid model—combining centralised infrastructure with federated execution by individual states. It supports over 200 million students and 7 million teachers and delivers content in 36 languages, with more than 5.8 billion learning sessions recorded. Its agility during the COVID-19 pandemic—especially through innovations like QR-coded textbooks and scalable teacher training—demonstrates how local adaptation, daily utility, and institutional embedding can drive both reach and impact in education delivery.

These examples—from identity to payments, governance, education, and commerce—underscore a critical insight: every DPI, regardless of domain or design, requires some form of orchestration. Centralised models like Aadhaar and UPI succeeded through mandates and immediate utility. Federated or ecosystem-driven platforms like DIGIT, ONDC, and DIKSHA show that success also hinges on aligning infrastructure with institutional capacity, localised relevance, and clear user incentives. Even technically sound DPIs like AA and DigiLocker struggle without visible daily value. Ultimately, centralised or distributed orchestration must include standards, incentives, and persistent feedback loops. DPI adoption is not automatic; it must be earned through purposeful design, aligned governance, and real-world impact.

Also read: Digital India Programme: A journey of transformation

When to Orchestrate and How

India's DPI story shows that success is not about choosing between top-down and bottom-up models but knowing when to use which. Centralised orchestration works best when scale and urgency are critical. Ecosystem orchestration is better when innovation, decentralisation, and iterative development are needed.

Domains like finance or identity benefit from standardisation and strong oversight—hence, Aadhaar and UPI thrived. In contrast, sectors like urban governance and commerce may require more adaptive models, combining government stewardship with active ecosystem roles.

In each case, orchestration must be matched by a clear value proposition. Adoption depends on how tangibly the DPI improves lives or operations, whether centralised or distributed. Timely utility, not just theoretical potential, drives participation.

Building a DPI Strategy for the Future

As India expands DPI to new domains—Education, health, agriculture, justice, and others —the lessons become clearer. Success demands:

• A strong architectural backbone that enables interoperability and security
• Alignment between infrastructure, institutional capacity, and governance
• Ecosystem incentives—both immediate and sustained
• Feedback loops to continuously evolve the DPI based on real-world use

Policymakers must ask: What pressing problem does this DPI solve? Who will benefit immediately? What nudges will accelerate adoption?

India has already demonstrated that DPI can transform public service delivery. The next wave of success will depend on bold designs and whether those designs are tied to purpose, people, and results.

Balakrishnan, M., Post Doctoral Research Fellow, Centre for Digital Public Goods, Indian Institute of Management, Bangalore, India 

Srinivasan, R., Chairperson Centre for Digital Public Goods, and Professor of Strategy, Indian Institute of Management, Bangalore, India