Trust: A Catalyst for Shared Economy’s Growth
Use of technology-driven fraud solutions can enable shared economy platforms to help new age entrepreneurs flourish safely
In the recent years, the shared economy has piqued unprecedented interest and witnessed exponential growth. It is much like the barter of the bygone era that has returned in a sophisticated avatar, leveraging technology to the maximum. Evolution of sharing platforms has taken the barter concept forward and created numerous opportunities for new-age entrepreneurs to use their un- or under-used assets to realize monetary advantage.
Freedom and Convenience
Shared economy enables on-demand access to goods and services, which has helped create greater employment opportunities and boosted entrepreneurship. It has changed the future of work with a large number of workers dropping out of their regular organizational jobs to work according to their own schedules
Traditional industries including hospitality, travel, and transport have seen emergence of disruptive business models in the form of sharing platforms such as Airbnb, Uber, and Lyft. These platforms provide a convenient way for people to travel or seek accomodation. Sharing economy platforms have also made it easier to access non-traditional services such as dog boarding (Dog Vacay), hiring people for certain tasks (TaskRabbit), bike renting (Liquid), building brands (Zaarly), sharing home wifi (Fon), and even borrowing money in cash (Lending Club).
Technology + Trust = Business Growth
Shared economy needs technology to allow sharing of assets in a way that is location-agnostic. Adoption of technology and digital literacy are, therefore, central to achieving the scale and efficiently monetizing the available opportunities. Increased digitization and proliferation in the usage of smartphones in the recent times have proved a boon for the shared economy, catalyzing its exponential growth.
Another key imperative of the shared economy is trust. Fostering trust among parties involved in a transaction is key to building a successful platform. Unlike the barter system, where both transacting parties knew each other and enjoyed a certain level of trust, there is no such comfort of trust in the shared economy. Customers do not know the service providers and vice versa, and it takes multiple transactions to build that trust. Customers often select service providers on the basis of reviews or ratings. But, so far there are no appropriate mechanisms for service providers to verify if the customer is genuine or not. Therefore, it becomes the responsibility of the platform provider to offer a trustworthy platform for both customers and service providers.
Platform providers must build transparency in transactions, verify listings, conduct background checks of service providers prior to onboarding, and assure services are delivered timely. To this end, they need technology solutions that help them analyze customer and service provider data in order to get real-time insights. Solutions that correlate patterns and flag anomalous behaviors enable platforms to prevent fraud and enhance customer experience.
Build Trust with PayPal’s Simility
Simility, a PayPal service, with its omni-channel Adaptive Decisioning Platform enables shared economy platforms to foster trust among everyone in the ecosystem by proactively arresting fraud in its nascent stage. The Adaptive Decisioning Platform is a fraud prevention solution that leverages technologies such as artificial intelligence and machine learning to unearth anomalous patterns from structured and unstructured data from varied sources, thereby enabling business growth and scaling up.
To learn how Simility can help build a trustworthy platform for customers and sellers alike, while fueling business growth, consider registering for the member-only MRC webinar Relying on Trust: A Closer Look at Marketplaces OR contact us to schedule a demo.
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