This study investigates five peer-to-peer (P2P) platform markets and identifies the main issues for peer consumers and peer providers from the perspective of consumer policy. Online P2P transactions via platforms present both benefits and challenges for consumers. Policy makers need better understanding of how consumer interests play out on platforms so they can promote a responsible development of these markets.

Study findings and key highlights:

  • A very small group of 20 platforms or 4 % of the 485 platforms screened in 28 EU countries + Norway, are very large. Most of the platforms operating in the EU (81%) are small or medium-sized in particular sharing/hiring rides or odd jobs platforms tend to be small.
  • The business models of P2P platforms vary. Many of them, notably the larger ones, charge transaction fees for a variety of services they provide to peers. They actively manage or govern transactions between peers, monetise user data, and invest in market expansion. The high level of automation and the value of the data collected hold the promise of significant profitability for larger platforms benefiting from network effects.
  • More than half of the revenue and expenditure on both collaborative and (re)sale of goods platforms is generated by 10% of peers. A substantial portion of peer providers in the accommodation sector report they rent out accommodation on a regular basis, 15.9% once a week and 20.6 % once a month.
  • Peer consumers spend most money on renting accommodation and the least on the sharing/hiring rides. On accommodation, (re)sale and renting of goods, and odd jobs platforms peer providers report revenues that add up to 60 to 65% of the amounts consumers report they have spent. On sharing/hiring rides platforms 81% of expenditure appears to reach peer providers. The difference includes platform revenues and may also reflect underreporting.
  • Most active users are either satisfied or very satisfied with their experience. But peer consumers also report frequent problems: 55% had at least one problem over the past year, mostly related to the poor quality of goods or services, or to the goods and services not being as described.
  • On the larger platforms peers are likely to be confused or misled about who is responsible when something goes wrong: platform’s practices may give the impression they assume at least partial responsibility in case of problems, but their Terms and Conditions exclude any liability.
  • The core trust building tools on P2P platforms, peer review and rating systems and identity verification practices, are neither fully reliable nor transparent. Only about 40% of peer consumers and peer providers use reviews regularly.
  • Consumer rights apply to the service the platform offers to peers, but only civil law rules apply to rentals and sales on platforms between two private persons. These rules are mostly not tailored to P2P transactions online via platforms, and do not facilitate easy access to redress.