Of late, a growing number of users have been participating in the sharing economy. Whether you're renting an AirBnB, requesting a ride on Uber, or using peer-to-peer (P2P) lenders for a loan, the peer-to-peer marketplace is growing rapidly.
P2P players have been popping up everywhere, transforming the traditional online shop model. Collaborative consumption P2P models are highly capital-efficient, particularly because they rely on a community to develop and provide the services. A peer-to-peer platform will remove the intermediary that connects a service provider or a product to a customer. This decreases costs and enables faster transactions. Almost everyone benefits. This has helped P2P marketplaces to expand quickly, with the market estimated to be worth $355 billion by 2025.
Entrepreneurs have started looking at alternative ways to get their business working - if your new team of designers need to work on a month-long project, rent the computers or devices instead of buying it. In the peer-to-peer marketplace, there are thousands of service providers and assets that can be used - with significant cost-saving incentives tied to this.
The sharing economy offers users the flexibility to access services for as long as they need them. As mobile technologies give users the ability to access P2P services on-demand, it's no longer just a preference - the P2P network is increasingly seen as part of the larger economy.
Trust - why it's one of the most important factors at play
Users feel more comfortable buying items on eBay from merchants, which have been on the platform for a long time with top ratings from other users and in the best case, with verified business information. We feel more comfortable renting out our own Airbnb Apartment to somebody who has identified himself as a real person, somebody who earned the blue check mark as a verified user. As a concerned mom, we wouldn’t hire a nanny over an app without a verified profile on the other end - or would you?
Trust should feel seamless and friction-free for trusted customers with barriers only coming up for data privacy risks and threat actors.
Why identity verification plays a vital role
Technology and ease of connections have enabled users to tap into services or products - often through apps - and obtain them easily. When a market expands and strangers start to interact, removing friction by ensuring trust and building quality is important. The P2P concept has reached the most private areas of our lives.
Startups do not only offer platforms for dog walking or maid services but revolutionize the caretaking sector as well. Instead of choosing a retirement home for the elderly, it is now possible to hire a caretaker to take care of senior relatives at home. Along with newly released apps to monitor seniors' health condition, caretaking at home is made even easier. Besides the great benefits of knowing your relatives being taken care of in their beloved home, hiring a stranger bears a certain risk.
It's not just for the elderly - other businesses also rely on trust. Wag and Rover, nicknamed the "Uber for dogs" and "dog BnB," offer on-demand dog walking and dog sitting services through your phone. The popular apps have made it easier than ever to find someone to walk and watch your pets, but a growing number of reports of dogs being mistreated are raising new questions about how well these apps screen their walkers and sitters.
The Better Business Bureau is currently investigating Wag over claims made in their advertisements, including one that stated that walkers are "vetted through a rigorous screening process."
Identity verification and strong authentication platforms have become increasingly important in a P2P world as travelers stay in strangers’ houses, passengers hop into cars with a driver who is a stranger and pet-owners leave their pets in the hands of another caretaker. The need for verifying the identity of the person you're interacting with has increased as personal safety and well-being is put on the line.
Strong identity proofing is necessary, especially when connecting with people in our own homes. Digital identity solutions can bolster trust in the service provider and ensure better customer experiences. Verifying the identity of a service provider is always important but the person would not want every individual or family they interact with to take a copy of his/her passport or other important government IDs.
Through biometric technology, identity verification platforms help companies identify users, while protecting the user’s data by giving them control over what data to share and who to share it with.
"Our physical environments are becoming more interconnected and intelligent. We are getting intelligent cars, homes and shopping experiences depending on the person accessing a service as part of the custom made economy in which we will be interacting and authorizing actions with our Self Sovereign Identity," wrote industry expert Alex Preukschat.
Digital identity providers can connect multiple government or official IDs from across the globe to authenticate identities and build trust within a peer-to-peer marketplace. It can enhance the security of users, help the company adhere to compliance and monitor fraud - all without hampering the user’s experience.