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Trust is key to driving growth in the sharing economy

Trust is key to driving growth in the sharing economy
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The sharing economy is transforming how we interact and conduct business, commerce, health care, and more. As the sharing economy is built on interactions between partners and consumers, lack of trust is the most important hurdle. The absence of a standardized, fully reliable method of verifying the identity of participants and equipping them to prove the authenticity of their credentials could pose a real challenge to the success of the sharing economy.

Building trust in this virtual economic climate requires the frictionless identification of participants and their qualifications to secure transactions, even before they happen. While most companies understand the need for online identity verification, they lack the resources and capital required to organically establish checks that are effective, efficient, and secure for everyone involved.

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Let’s explore the 7 challenges of online identity verification to support you in building and maintaining trust with consumers:

  • The online identity verification process creates fiction. But it doesn’t have to. A good online identity verification system should be nearly invisible. As the sharing economy continues to grow and diversify, customers will pick the businesses that offer simplicity and an assurance of security. Conversely, if signing up is too lengthy, rigid, or intrusive, a would-be participant experience ends before it ever started.
  • There is no single definition of online identity verification. Traditional identity verification is a relatively standard process. Most people are compliant with — even comforted by — requests for ID in offline environments, like banks or airports. However, in this digital world, despite billions of online interactions (personal, enterprise, government), there is a lack of understanding of what identity verification means. Even the terminology varies widely by source and channel.
  • Identity verification processes constantly change. Currently, there is not a common and shared set of identification measures by sharing economy companies. Guidelines and privacy regulations change frequently and inconsistently across industries and geographies. The sharing economy is responsible for deciding what components to include in the identity verification process, as well as what to handle internally and what to outsource. To stay ahead of the dynamic requirements, you need to have a partner focused on market and regulatory changes.
  • Online identity requires a lot of PII. Personally identifiable information (PII) helps companies distinguish individual identity. It can include someone’s full name, social security number, or credit information. There remains widespread concern about how to secure personal data from a hacker capable of serious harm. You can avoid housing PII by outsourcing this function to an online identity verification specialist that assures the security of your users’ information and keeps your risk to a minimum.
  • Current methods reveal very little “real” information. Knowing someone’s name, birthday, or social security number doesn’t tell you anything about the qualifications or personal attributes that make them a valuable partner to others in the marketplace. The importance of knowing specific qualifications can vary by the sensitivity of the marketplace itself. For example, it’s important to know that, if you order an Uber or Lyft, the name and face of the person who arrives to drive you matches the one on the screen.
  • You must verify (and re-verify) constantly. Successful, consistent verification is vital to the health of your brand. Keeping up with constant verification needs does not be a challenge for your developers. It costs time and money, and ignoring it leaves you vulnerable to events that could seriously impact your brand. Whether it’s verifying new users’ profiles or keeping user credentials updated, a dynamic online identity verification solution will help you to make good on the all-important promise that legitimate individuals are engaged in your secure marketplace.
  • Mandatory regulatory requirements do not guarantee the security your company needs. While legal compliance with HIPAA, FCRA, and FDIC is mandatory, those standards are the minimum required. Just because they are required, does not mean they significantly benefit your security against data breaches. Going above and beyond these requirements is essential so your partners and customers feel confident whether or not you are providing a secure business environment.

Online identity verification is complex and dynamic. From making sure your customer identification process is intuitive and thorough, to minimizing the risks of managing PII, the effort requires an incredible level of diligence.

With that in mind, ensuring that every participant in the collaborative space has a simple, third-party verified online identity is vital to the success of your brand. Having an experienced partner who can manage these details effectively allows you to demonstrate that your marketplace is a safe, transparent place for people to engage in peer-to-peer interactions.

Put the security of your company into the hands of a partner that can keep the identity of your users up-to-date, keep you compliant, and separate you from the risks of holding and managing highly sensitive data.

David Thomas is the founder and CEO of Evident ID, Inc., and has held leadership roles at Motorola, AirDefense, VeriSign, and SecureIT.