The Sharing Economy and How It Has Changed Industries

Sharing Economy

The Shared Economy, also known as the Sharing Economy, is a framework for a very adaptable economic model wherein goods and services are offered, purchased, or shared amongst private persons — essentially a peer-to-peer (P2P) model. A community-based online marketplace that links buyers and sellers is a common component of the sharing economy.

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What Is A Sharing Economy?

Since the dawn of technology and the application of big data, people have shared assets for thousands of years, but now it is simpler for asset owners and those looking for those things to locate one another. This idea is also known as the Peer Economy, Collaborative Economy, Sharing Economy, or Collaborative Consumption. Simply explained, sharing economies enable people and organisations to generate income from their idle or underutilised assets

Today’s world has quickly come to accept the idea of a shared economy. As a result, an increasing number of people are switching from the conventional system to one that permits the sharing of resources, information, ideas, and services, thereby facilitating greater collaboration.

In this new economic structure, people, peers, and small enterprises can share office space, services, resources, and skills for a lot less money than in the old one.

Types of Sharing Economy

As previously indicated, individuals have long borrowed and lent assets and resources for a variety of purposes. Sometimes the conditions were amicable, but other times they had to give up resources to get what they needed at the moment. The Sharing Economy relies around 3 fundamental ideas, depending on the terms of sharing:

  • Real sharing occurs when a gift is given freely and without conditions.
  • Giving gifts is the practise of giving anything without charge but with conditions.
  • Giving things away with the intent to profit from it is known as pseudo-sharing or commercial sharing.

The Sharing Economy of today is best characterised by pseudo- or commercial sharing in this digital age. Businesses now have options to partake in a range of Sharing Economy practises that help them expand their boundaries and increase their revenues.

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Advantages of Business Models in the Sharing Economy

The Sharing Economy has led to economic growth and more job opportunities in addition to creating a variety of novel business models.

  • Greater reach for a wider range of users
  • Greater flexibility
  • Sense of belonging to a community
  • Build loyalty based on trust
  • More efficient allocation of resources
  • Eliminate unnecessary investments
  • Job Creation
  • Creativity and Innovation
  • Opportunity to earn extra income
  • Monetizing underutilized assets
  • Save money and resources
  • Reduce environmental impact

 

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Sharing Economy Examples

In a sharing economy, resources and other assets are shared, reused, and rotated among various people and organisations. The idea is expanding quickly as more and more customers look for more affordable ways to locate, fund, and buy assets or resources. We’ll give you few sharing economy examples of companies who have utilised the sharing economy concept and evolved to meet client needs.

There are 8 main sharing economy examples and instances of sharing economies.

Co-Working Spaces

The service of shared offices is offered globally by coworking spaces like WeWork. Without having to worry about the overhead and expense of renting a complete building or office, young business owners, independent contractors, and startups with limited funding can rent a desk or an office. Conference rooms, internet, phone lines, free coffee, and other amenities are also provided by co-working spaces. Depending on the length of time you spend at the office and the quantity of space you need, you must pay a weekly or monthly fee.

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P2P (Peer-to-Peer) Lending

It can be challenging to obtain a loan when your credit score is poor. A further burden is dealing with banks and all of their rules, paperwork, and restrictions. To get yourself out of this situation, you can borrow money from your friends. Without using a traditional bank, people can lend and borrow money through peer-to-peer lending networks. Peer-to-peer lending is a concept that connects investors (lenders) who are searching for high returns on their investments with borrowers looking for unsecured loans. As a result, P2P lending is a system where a borrower in need of money can obtain a loan from an investor who can do so at a specific interest rate. P2P lending platforms help those individuals get loans faster who have a low CIBIL score. Additionally people with no documents can also avail loans from these lending platforms.

Peer-to-peer lending services like Money Club, an AI-driven online chit fund platform, enable borrowers to take out loans at rates that are significantly lower than those offered by the majority of banks and credit card firms. Both sides benefit since the borrower receives money and the lender receives interest on their investment. By selecting chit funds as a regulated, fixed-income, secure investment alternative, both businesses and families stand to gain significantly.

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Crowdfunding

Artists who need money to launch their creative projects can connect with others who are prepared to give through crowdfunding sites like Kickstarter, a platform devoted to creating a community around creative initiatives. The Sharing Economy platform also enables users to donate money to causes that interest them.

Contrary to peer-to-peer lending, the money recipients are not usually required to pay back the loan. Some crowdfunding projects operate like grants, when individual lenders contribute money knowing they won’t be reimbursed. To encourage this kind of contribution, the receivers do occasionally offer incentives like goods. Using crowdsourcing to raise money may make it easier for businesses and projects to do so. For creative people, using a crowdfunding platform saves time and provides better opportunities.

How Does Peer-To-Peer Sharing Platform Help Individuals?

Ride-Sharing And Car-Sharing

Uber is a prime sharing economy example. Individual drivers are permitted to run a taxi business on this sharing economy platform. A ride on the same route can be found for up to 4 passengers. The passengers share the cost of the transport and the ride itself using this ride-sharing app.

Sharing a vehicle is nothing new; rental car businesses offer shared vehicles to customers who require them for a single day. Car owners who are prepared to lend out their vehicles can earn money by doing so via a website or mobile app. A person who owns a car and a person who needs a car can be connected through a car sharing service.

Renting a parking space

Parking can be very difficult to find in crowded areas. A well-known platform called Park India offers parking solutions to lessen driver annoyance and irritation. Drivers can use it to look for parking spots nearby and get directions to the chosen parking space.

Park 24×7, a business located in Kolkata, has developed a platform that connects vehicles looking for parking with people who have space to spare. The area may be a private driveway, parking lot, or even a garage. To save time, drivers can use the app to park at vacant spaces at hotels, hospitals, stores, schools, and public parking lots. It provides real-time parking space availability and enables users to make reservations for certain times or on a monthly basis.

Sharing Education

Learning is no longer limited to the four walls of the classroom. A marketplace for the education sharing economy called Udemy links teachers and learners from all around the world. Teachers are enabled to present current content and convey knowledge and skills to their pupils with the aid of cutting-edge technology.

Freelancing

People who possess certain talents and knowledge provide their services in exchange for a charge under this sharing economy theory. Upwork is a well-known sharing economy example that connects service providers and customers. Clients can hire independent contractors from all over the world using this platform. Additionally, this internet market assists traditional freelancers, such as programmers, graphic designers, and writers, in connecting with business owners seeking their skills.

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Renting an apartment or house and couch surfing

A well-known illustration of a multinational corporation that enables the Sharing Economy is Airbnb. The internet platform connects customers who need a rental apartment or a house to stay in with owners who wish to make money by renting out a spare room or property.

In the past, if you needed a place to stay when travelling and were in an unfamiliar area, you had to check into a hotel or motel. Today, however, you may find folks who are prepared to offer their full house and all of its amenities – frequently for less money than standard hotels. When they’re not using the property themselves, hosts normally determine the nightly rate and the available dates.

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