In the midst of Global Sharing Week, the explosive growth experienced by the sharing economy is top of mind. Set to be worth an estimated £335 billion by 2025 in the UK alone, nearly a quarter of the population are involved in some way with the sharing economy: whether by booking a rideshare, transferring funds via a P2P platform or buying a product off Etsy.
Furthermore, the millions of transactions taking place across companies in the shared marketplace each day has led to an increase in financial crime and other nefarious activities. Moreover, individuals who have devised ingenious techniques of laundering money, continue to line their pockets.
Micro-laundering, which involves transferring large sums of money by scattering it over thousands of electronic transactions, is putting the very foundations of the shared economy into question. Europol estimates £3 billion, or three to four per cent of the continent’s annual criminal takings, is micro-laundered.
The benefits of the sharing economy will continue to be eroded if a reliable, sustainable solution is not introduced to not only match, but surpass the sophistication of bad actors, says Zac Cohen General Manger at Trulioo. He comments: “To combat emerging trends in money laundering, an agile, sophisticated solution is required. Using proper fraud prevention techniques, such as authenticating identity traits across multiple trusted sources, while leveraging up-to-date technology and data, is a step in the right direction. By placing electronic identity verification at the beginning of the customer onboarding process, online platforms can prevent fraud by simply keeping bad actors at bay.”
“The foundation of the digital economy begins with effective identity systems that mitigate the risk of fraud, establish trust between transacting parties, and ensure products and services are delivered seamlessly. As the sharing economy continues to grow, deploying effective identity verification protocols, hardwired into business processes from inception, will ensure fraud detection and mitigation remains a cornerstone of the shared economy.”
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