Ideally, an absence of payment fraud is attainable if there is a complete trust between the buyers and the seller, but because 100 percent trust is unachievable, some marketplaces engineer trust, thereby reducing risk for buyers and sellers.
Below, we describe four aspects when engineering trust: the use of reviews, the fact that credibility builds over time, the technique of transferring credibility from socials, and the use of bios and verified phones.
Combined, these mechanisms greatly help reduce the level of risk of the transaction as perceived by buyers and sellers before the sale and, as observed after it is completed.
|Reviews||Airbnb, for example, lets request or pro- vide reviews, which helps buyers and sellers build credibility and, in turn, trust. Others, like eBay and Amazon display the number of transactions and/or the average ratings of profiles.
These are extremely useful when evaluating the level of risk because it is unlikely that sellers and buyers with a good record of sales are scammers.
|Transfer credibility||As credibility metrics are built over time, it's harder for real buyers or sellers who are starting out and thus have no credibility yet, to make sales quickly and effectively, because they are viewed as presenting a higher risk.
One way Airbnb and, to a lesser extent, eBay and Amazon, address this is to allow buyers and sellers to build their own credibility by linking their buyer or seller profiles to other social profiles, e.g., Facebook, Twitter, or Google+. This way, the credibility established on other social networks is transferred to the e-commerce service.
|Bios and verified phones||In addition, Airbnb provides bios, adds phone numbers that have been authenticated with short codes, and verifies emails with activation links.|