ONDC and IBDIC Partner to Strengthen MSME Financing, Build Trust in Supply Chains
In a major boost for India’s digital financial infrastructure, the Open Network for Digital Commerce (ONDC) and the Indian Banks’ Digital Infrastructure Company (IBDIC) have signed a strategic Memorandum of Understanding (MoU) to expand secure, transparent, and inclusive access to credit for micro, small, and medium enterprises (MSMEs).
The collaboration aims to mitigate the risks of double financing, a recurring challenge in MSME supply chain finance by InvoiceHub, a trusted repository of verified invoices. This innovation will not only enhance lender confidence but also enable MSMEs to access faster and safer credit, reducing friction in working capital flows.
Expanding Digital Rails for MSME Credit
ONDC has been at the forefront of building open digital infrastructure to democratize commerce and financial access. Its partnership with IBDIC, which is backed by major Indian banks, aligns with the vision of creating interoperable, secure credit marketplaces. Together, they are laying the foundation for an open supply chain financing ecosystem, where lenders gain access to authenticated invoice data, and borrowers gain broader choice of financing products.
Speaking about the initiative, Vibhor Jain, Acting CEO & COO, ONDC, noted:
“With ONDC, we are committed to building infrastructure that fosters inclusion by creating new markets for lenders and giving borrowers more choice. This MoU with IBDIC strengthens MSME financing and supply chain trust by reducing risks of double financing.”
Ashish Singhal, CEO of IBDIC, added:
“With InvoiceHub, we are building a trusted repository of verified invoices to power India’s $10T economy vision and Viksit Bharat 2047. This will boost transparency and confidence across the MSME financing ecosystem.”
Why This Matters
India’s 6.3 crore MSMEs contribute nearly 30% to GDP and 45% to exports, but access to formal credit remains limited. Estimates suggest that the MSME credit gap exceeds ₹25 lakh crore, with many small enterprises still dependent on informal lending. By reducing risks such as invoice duplication, this initiative directly addresses trust deficits in supply chain finance, one of the biggest barriers holding back credit penetration.
Strategic Implications
- For MSMEs: Faster loan approvals, improved access to affordable working capital and reduced dependence on informal borrowing.
- For Lenders: Enhanced confidence in invoice-backed lending, reduced NPAs from duplicate financing and access to a wider borrower base.
- For the Economy: Stronger credit penetration will fuel MSME competitiveness, strengthen supply chain resilience and accelerate India’s journey towards becoming a $10 trillion economy by 2047.
This ONDC–IBDIC partnership signals a shift from fragmented financing to a more standardized, open-access credit ecosystem. In effect, it creates a “trust dividend” for MSMEs by blending digital transparency with financial inclusion.
