The expansion of India’s B2B marketplaces is projected to be aided by expanding internet access, digital infrastructure, good regulatory regulations, and a positive cross-border environment.
According to a report released on Tuesday by venture capital and private equity company Bessemer Venture Partners, India’s online B2B marketplaces might expand to reach a $200 billion market potential by 2030.
In the next ten years, India’s $3.75 trillion economy is expected to grow to $6 trillion, and we predict that the digital economy, which is currently worth $100 billion, will eventually reach $1 trillion.
While consumer digitization accounted for the majority of India’s digital economy’s first $100 billion, according to the report, “we believe that business digitization and online transactions—or what we generally refer to as business-to-business (B2B) marketplaces—will account for a significant portion of the digital economy’s next 10X.
A projected 1% of India’s total B2B market will be made up of online B2B marketplaces in 2022. By 2030, the analysis predicts that its share will increase to just under 5% of the market as a whole.
“By 2030, we anticipate that online-first, tech-enabled B2B marketplaces will represent a remarkable $200 billion market opportunity,” Bessemer Venture Partners stated in its research.
The three emerging categories within online B2B markets are identified in the report as product marketplaces, service marketplaces, and marketplace infrastructure startups.
The expansion of India’s online B2B marketplaces is projected to be aided by expanding internet access. It has an expanding digital infrastructure, good regulatory regulations, and a positive cross-border environment.
“Key contributors to the growth will include instant payments through a Unified Payments Interface (UPI), the formalization of businesses through the Goods and Services Tax (GST), increased manufacturing activities through Production Linked Incentive (PLI) schemes, and the global de-risking of supply chains with companies adopting a China +1 strategy,” it stated.
Anant Vidur Puri, partner at Bessemer Venture Partners, noted that the e-B2B sector in India is still in its infancy.
“B2B marketplace firms have the chance to follow the same growth trajectory that B2C internet companies did in the previous ten years within the next five to ten years.”
“B2B marketplaces must take on a bigger role than traditional distributors in order to fully take advantage of this opportunity. They must concentrate on offering end-to-end management of transactions with a strong technology and software layer while also ensuring strong control over supply, quality, and service levels,” Puri said.
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