One of the first lessons we learn is how to share. As a result, we quickly learn that certain people are trustworthy and others are less so. The same rules apply, but at an exponential scale, when we are talking about the sharing economy. How can someone trust a renter, a driver, a caregiver — or vice versa? Marketplace operators need to ensure that a layer of trust exists among all participants who are using their platform.
To promote a deeper understanding of knowing your customer, Trulioo has partnered with PYMNTS for an ongoing report, the AML/KYC Tracker™. Download the Tracker to stay on top of the latest trends, techniques and information regarding AML/KYC:
The sharing economy is “an economic model defined as a peer-to-peer (P2P) based activity of acquiring, providing, or sharing access to goods and services that is often facilitated by a community-based on-line platform” (Investopedia).
The growth of the sector is astounding, from $15 billion in 2014 to a projected $335 billion in 2025. Of course, much of the growth is attributable to better technology: mobile devices providing quicker and easier access to services, as well as back end technology that can better profile, match, review, monitor and handle payments.
Creating a community
However, when we are talking about sharing, the fundamental aspect is people. Sharing services are essentially a way to connect the skills and services of one person to another. At its core, a sharing service needs to clarify the ambiguous questions of quality, of accuracy, of delivering on the promise. It all comes down to trust: Can you trust that rating? Can you trust that profile? Can you trust that the person won’t rob you or defraud you?
Ensuring that marketplaces have the necessary trust starts at the onboarding process. Any person or business that signs up to participate in the sharing economy should be properly vetted. Any well-designed marketplace should first take steps to know who they are dealing, or, in the case of a business, what business they are dealing with.
While vetting might sound simple enough, the intricacies of verifying a person or business digitally are a deep, complex problem, especially when dealing with a global audience transacting in today’s borderless economy. There are numerous data points that provide different analyses. Multiple data partners have different data, access requirements, system protocols, data usage rules, information formats and other variables. Obtaining secure access to one source is difficult enough, let alone accessing the hundreds that any global organization requires to verify identities online. Regulations around privacy and data, which require strict compliance and security protocols, differ around the world and change regularly. And, in today’s ultra-competitive environment, first impressions can make or break you. Identity verification has a significant impact on customer experience, which is why the verification process should be quick and seamless.
To learn more about how modern marketplaces are approaching verification, read the July AML/KYC Tracker™, which also includes information about:
- New FATF cryptocurrency guidelines
- How Bitbuy keeps its cryptocurrency exchange safe
- India’s new KYC requirements
- Coinfirm’s AML-related partnership with Ripple XRP