The Impact of Verification on Marketplace Trust and Safety
March 26, 2019
The Impact of Verification on Marketplace Trust and Safety
Marketplaces are a game-changer for today’s consumers. With the click of a button, anyone can hail a ride, schedule a house cleaning, book an in-home massage, and, in some highly sensitive applications, hire a dog walker, registered nurse, or babysitter.
These on-demand experiences, however cost-effective or convenient they might be, are inherently risky interactions, which is why the most successful platforms go to great lengths to ensure user safety by assuming responsibility for verifying their identity and credentials.
Marketplace businesses that incorporate identity and credential verification into their onboarding processes are better positioned to:
- Establish trust in the community
- Inspire confidence in the platform and its products/services
- Prevent fraud and risks associated with fraud
- Differentiate themselves from platforms with similar offerings
This PwC study found that 89% of consumers believe the sharing economy is based on trust between providers and users, and 64% believe that peer regulation is more important than government regulation. These findings suggest that, for marketplaces, building platform confidence is just as important as providing a quality product or service, and verifying workers is one of the most meaningful ways to establish trust.
Marketplaces should leverage identity and credential verification to curate a network of trustworthy workers and service providers. A caregiving platform that not only conducts background checks on nannies, but also confirms their identity and validates their driver’s license, employment history, and CPR or First Aid certification on an ongoing basis is ideal for protective parents. Their positive experience might even inspire them to evangelize the platform and become an invaluable source of word-of-mouth marketing.
Marketplaces that put the onus of verifying personal data on their customers are merely platforms that facilitate connections with no oversight or responsibility. It’s important for consumers to understand the difference between this and a platform that fully vets each worker to ensure that they are who they claim to be and that they have the right credentials to perform a specific task.
In addition to the caregiver scenario, here are a few other examples of credential verification for marketplaces with more sensitive applications:
- Ride-sharing platforms that verify driver’s licenses, auto insurance, motor vehicle registrations, and criminal histories
- Legal service platforms that verify law education and employment histories
- Home-sharing platforms that verify property ownership, addresses, and insurance
- Home service platforms that verify insurance and professional licenses like plumbing, HVAC, electrical, etc.
Marketplace businesses, especially those with more sensitive use cases, have a duty to create and maintain a consistently safe environment, and must be able to quickly verify users and easily track any changes to their data. It’s equally important for sharing economy platforms to receive ongoing status updates verifying any changes in their workers’ criminal activity, professional licenses, or other credentials, so they can take immediate action to alert their customers and/or remove the workers or service providers that no longer meet the company’s policy requirements.
Likewise, customers need to feel confident that a platform’s services and workers are safe, and marketplace workers need to trust that their employer has vetted its customers and that they, too, are trustworthy. Though not commonly acknowledged, these workers also assume a fair share of risk given their higher frequency of interacting with strangers.
- A customer hires a professional from a home service platform to repair an appliance inside their house and needs to know that they are who they claim to be, have no criminal history, and that their professional license exists and is valid.
- A customer uses a moving platform and needs to know that the moving truck driver has a valid license, the vehicle has a valid MVR, and that the movers handling their personal items and entering both their new and old homes have no criminal history.
- A ride-sharing platform driver needs to know that their passenger’s identity has been verified so there can be some recourse in the event they are physically assaulted or verbally abused by the passenger.
- A home-sharing platform host needs to know that the identity of the individual who’s renting their home has been verified so there can be some recourse in the event of any guest-perpetrated theft or property damage.
Verification can be as simple as matching a selfie to a driver’s license to confirm identity, and can be as complex as checking multiple data sources for a worker’s criminal history, MVR, professional license, and other credentials, depending on the company’s policy requirements. Marketplaces often justify skipping this critical step to simplify their onboarding processes and increase funnel conversion, but when the stakes are high, some friction is actually warranted. Luckily, with new technology platforms, businesses don’t have to increase friction to maintain high platform standards.
Businesses want identity and credential verification to be efficient enough to accommodate their consumers’ busy lives, but secure enough to protect them from fraud, identity theft, and invasion of privacy. Technology that automates verification processes can help sharing economy platforms achieve a greater level of assurance without adding friction or risk.
Evident uses artificial intelligence, machine learning, and facial recognition technologies to automate identity and credential verification processes so that marketplaces and companies of all industries can make informed business decisions about their employees, customers, and vendors based on the most accurate, up-to-date personal data pulled from thousands of authoritative sources.