GlobalSign Blog

05 Aug 2015

Digital Identity in the Sharing Economy

The rise of the sharing economy in the Internet gives the average person opportunities that were previously not possible. Now, anyone can start their own taxi-type of business by becoming a ride sharing driver. House and apartment owners can begin to rent out their properties like a hotel through Airbnb. Consumers have more choices at their disposal through companies that link the individual service provider and the consumer. Everything is done through the Internet using apps or an online site.

The sharing economy is largely based on trust. Providers and consumers sign-up through Internet-based services, and they conduct transactions using their app or the online site. In a ride sharing scenario, the first time the provider and the consumer actually meet or speak to each other happens when the car pulls over to the curb and picks up the passenger. When you rent someone else' apartment, you might never see the actual owner. Just a week ago, I had a chat with my colleague who rented a house in another country through Airnnb. The doors were open, keys on the table when they arrived with the instructions to just leave the keys on the table when they would leave. They never saw the owner.

Most people are trustworthy and our society would not function if otherwise. Then, there are the few bad apples, who take advantage of this trust. When we deal facelessly over the Internet, trust might be harder to establish. The sharing economy relies on 3rd party sources to establish identities of providers and consumers. Airbnb users can even opt-in for a verified identity by sending a photo of their government issued ID to the verification service. Anyone with any infosec background can see that this is only a minor improvement over the default establishing routine that relies on Facebook profile information, which can be augmented with Google and LinkedIn social identities.

On a rare occasion, you see news about a guest having a party and obliterating the apartment. Airbnb takes these situations seriously and has a protection plan for their hosts. So, Airbnb is making sure that something goes wrong, the host is covered.

In a sharing economy where companies like Uber and Airbnb link people globally, identity verification becomes very hard. Anyone with decent Photoshop experience can fake a government issued ID card or a driver’s license. The only way to reliably establish an online identity is to use a government issued electronic identity, or in a pinch maybe a bank issued electronic identity. These identities require face-to-face registration, and another identity document such as a passport is used to verify the identity before issuing the electronic identity. And in the backend, several processes are in place to further verify a person’s identity by inquiring with official databases and other resources.

Sites such as Airbnb, sharing economy start-ups or established players would benefit hugely by offering a way to establish an online identity based on the quite reliable government eID. Not only would it bring true piece of mind between the provider and the consumer, but it would most probably also help sharing economy companies lower their insurance fees. It would not completely eradicate the problem associated with the few bad apples.

Verified, reliable and trustworthy digital identities are the key for the sharing economy. GlobalSign identity and access management (IAM) solutions can connect to dozens of governmental or other official eID infrastructures quickly and effortlessly to prove true identities and build trust between the consumer and the provider. Learn more about GlobalSign’s IAM solutions today.

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