Is escrow key to safeguarding the platform economy?

by Anna Tsyupko, CEO, Paybase Escrow is undergoing a renaissance. As the platform economy grows, escrow’s ability to safeguard it is even more valuable. According to a recent Forbes article, “The job of a platform economy business is to enable two strangers to transact without any friction, while ensuring the transaction is safe.” This tension, it argues, comes as a result of growing consumer expectations. Given the consumer-to-consumer (C2C) nature of much of the platform economy – gig or sharing economy platforms, online marketplaces and fintechs – it is perhaps not surprising that payments security is one of the key hurdles for platform businesses to overcome. However, streamlining security and user experience can be difficult. Today, there are various options available to fulfil these consumer demands, one of which is escrow. We investigated escrow’s potential in the platform economy and what’s caused the instrument to break into mainstream use. Click here to read our full whitepaper.

What is escrow?

Escrow is the act of holding funds in a third-party account when a payment is made. Once the transacting parties are happy, the transaction can be authorised and the funds released. www.youtube.com/embed/4PgFG8JaWNo The journey of escrow, and its modern renaissance. Video by Paybase. Escrow has been on a turbulent road from its creation to now. It began life on the property market in the 1930s as a manual, legal process – 70 years later, the advent of the internet introduced digitised escrow, triggering a pattern of scams that severely dented its online reputation. Now in its third iteration, escrow has been tried, tested, developed and safeguarded by innovative payments providers, and it is finally ready for democratised use. here.