Mutual trust counts in sharing economy
- By Guo Yiming
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E-mail China.org.cn, March 27, 2017
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| Panelists discuss the topic of "sharing economy" at a session during the Boao Forum for Asia on March 26. [Photo provided to China.org.cn] |
The explosive development of China's sharing economy now penetrating various sectors is built on mutual trust among strangers, and this will continue, according to panelists attending the Boao Forum for Asia on Sunday.
From sharing cars and bikes, to houses, meals and spare possessions, China's startups are offering a wider variety of services to consumers in a more prevalent way than at any time and any place in the world, they agreed.
However, the booming business model of bringing under-utilized assets into collaborative consumption is also meeting new challenges, including frequent reports of vandalism and a trust crisis in many cases.
Photos of sharing bikes in chaotic piles, or covered with thick dust, or lying on the ground with broken chains have been widely publicized on social media websites.
According to various media reports, some criminals steal, or even dismantle the GPS component fitted to the bikes, and sell them on the internet.
Complaints also abound in accommodation-sharing sites with both lodging hosts moaning about disruptive behavior in their properties and lodgers complaining about default or broken promises.
"Trust is the lifeline for the sharing economy," said Huang Wei, CEO of Zhuanzhuan, a pre-owned products trading platform. "If all the companies in the emerging sector can incorporate a credit system to which we can relate, it will possibly ward off some violations of market rules."
In face of the new challenges, more peer-to-peer vendors are introducing an identity verification system to their platforms, thus adding more transparency and reducing the fear and friction that can occur when strangers do business.
A third-party credit-scoring system, like Sesame Credit (Zhima Xinyong in Chinese) to rate credit worthiness based on personal spending habits, is also incorporated in various platforms of the emerging sector.
Bike-sharing startup Ofo is running a trial in Shanghai to allow its users, who have a credit score of 650 or more, to get the ride service without paying the 99 yuan (US$14.4) deposit.
"Home Cooking," or Huijia Chifan in Chinese, that allows its users to share food with neighbors, only permits meal providers passing strict health checks and with real-name verification to enter the platform, "in order to build trust," said Tang Wanli, founder of the startup.
Dai Wei, founder and CEO of Ofo, said: "If everyone is aware of the fact that we are all part of this sharing economy and are using collaborative assets, we could build a more sustainable ecosystem for the sector."
Last year, 600 million people were involved in China's sharing economy, surging by 100 million from 2015. The number of service providers reached 60 million, 10 million more than the previous year, according to a report released by the State Information Center earlier this month.
The new mode of operation brought about by the sharing economy will penetrate various fields, including products, services, capital, knowledge and skills, as well as production capacity, and is expected to maintain a 40 percent annual growth rate in the coming years, the report says.
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