MSMEs in Retail: From WhatsApp Orders to ONDC Futures

In cities across India, the quiet buzz of two-wheelers now signals more than just traffic it marks the arrival of 10-minute groceries, last-minute snacks and forgotten essentials. Quick commerce is no longer a trend. It’s an expectation.

And it’s shaking the very foundation of India’s most enduring retail institution: the kirana store.

A New Challenger in the Aisles

Over the last two years, platforms like Blinkit, Zepto and Swiggy Instamart have transformed retail behaviour in India’s urban pockets. What started as a consumer convenience delivery in 10 to 15 minutes has evolved into a structural shift in how people shop for daily needs. The model is powered by dark stores, predictive analytics and hyperlocal logistics advantages that traditional mom-and-pop kirana stores, typically run by small business owners, never had access to.

According to industry research, India’s kirana stores saw their retail market share drop from 95% in 2018 to 92.6% in 2023. By 2028, that’s projected to fall further to 88.9%. These may seem like small percentage points, but in India’s ₹70 lakh crore retail industry, even a 1% shift represents billions in lost sales largely from the country’s smallest, most vulnerable retailers.

Kirana Stores = MSMEs, But Not Yet Digitized

While we often speak of MSMEs as factories, startups or exporters, the Indian kirana is one of the most prolific micro enterprises in the country. There are over 12 million of them, and they account for a huge share of both rural and urban retail employment. But they are, by and large, informal. Most do not use ERPs, maintain digital stock logs, or formally track customer orders.

That’s the real risk. In a retail environment now defined by speed, user experience, and data-backed replenishment, the informal structure of these MSMEs has become their biggest vulnerability.

Quick commerce platforms are not just offering faster delivery they’re capturing market share through predictable inventory, real-time offers, clean UX and frictionless payment. The kirana store may have trust and proximity, but those are no longer enough.

Digital Transition: From WhatsApp to ONDC

Still, the story is not one of defeat. Many kirana stores are beginning to adapt. And they’re doing it the MSME way incrementally, frugally, and with a keen eye on customer retention.

Enter platforms like ONDC (Open Network for Digital Commerce), a government-backed initiative designed to democratize e-commerce. ONDC is enabling small retailers to list their stores online, manage inventory, integrate with third-party logistics and accept digital payments all without building their own app or investing in expensive infrastructure.

Retail-tech enablers like Kiko.live and Pincode (a PhonePe-backed platform) are also playing an important role. They offer plug-and-play storefronts, real-time order management and most crucially handholding. This ecosystem approach is helping kiranas turn their ad-hoc WhatsApp order systems into structured, app-like ordering experiences that mirror what quick commerce platforms offer, but at neighbourhood scale.

What Makes It Work for MSMEs

The pivot to digital isn’t just about going online. It’s about restructuring the back end. Inventory visibility, delivery coordination, customer communication and even monthly billing summaries are now being digitized in small stores that once operated entirely in cash and memory.

This isn’t about competing with the deep pockets of VC-backed platforms. It’s about protecting and formalizing a 10–15% slice of their business home deliveries, regular customers, bulk buyers that is at real risk of migration. For many kiranas, this slice makes up the buffer that supports working capital rotation, monthly wage payments and family income.

By offering predictable delivery times, simple UIs and digital loyalty models, kirana stores are slowly building back the moat they once had not just trust, but consistency.

The Policy and Credit Implications

As kiranas and small retailers digitize operations, there’s a bigger opportunity on the horizon: formalization. Every online order, digital payment or e-invoice is a data point that can be used to access better credit, faster working capital and vendor discounts.

Financial institutions have long struggled with thin-file MSMEs. Now, with ONDC integrations and sales data, new credit models particularly embedded finance and cash-flow based lending can fill the ₹30 lakh crore credit gap that still haunts this sector.

For regulators and policymakers, this is a moment to reframe MSME support. Not just through subsidies, but through enablement where training, onboarding and low-cost SaaS support are funded as part of broader digital inclusion.

A Future Still in the Making

The quick commerce disruption is real. But it need not be fatal for kirana stores or MSMEs in retail. What we’re seeing now is the early stage of a hybrid ecosystem where proximity-based trust meets platform-based efficiency.

The kirana of tomorrow won’t just be the shop next door. It could be your 30-minute delivery partner, your trusted vendor on ONDC and your digital-first retailer with real-time visibility and GST-compliant invoices.

India’s retail backbone is bending but if it digitizes fast enough, it won’t break.