Centralized allotments for admissions, centralized control of franchises or a large-scale event at multiple locations, centralized manufacturing facilities of industries etc combine convenience and regulation on a regular basis. In special cases like financial management, centralized control may be convenient for the regulatory bodies, but might pose challenges on the customer-interaction front. This why, a decentralized economy becomes beneficial both for the service providers and the customers.
There is no argument that in any kind of interaction be it business, exchange or sharing, a direct transaction between the concerned individuals gives the best result. While buying or selling products or services between the two individuals, a decentralized process without any third party control is implemented is called a peer-to-peer (P2P) economy. The manufacturer of a commodity or the creator of a service has complete ownership of the product and the means of production here.
Morally and economically an advanced system
In the regular market, a product is produced by an individual or a company and a second person distributes it as retail. The producer gets the profit after the distribution chain members get their share. On the other hand, in a P2P economy, since the producer directly sells his products, the result is wholly his own. This process can be a part of the regular capitalist economy and can co-exist with each other. Several industries sell their products online along with other retail chains and E-Commerce sites. You have your regular taxi as well as direct travel applications running on open-source software functioning together successfully.
Now, coming to the side of the customer! As the producer is bound to bear the response to his product upfront he has increased the risk of failure and full responsibility for the quality. In every term, he will try to bring in the best output to ensure that he becomes successful in getting customer satisfaction. For further attraction, the customers get the same goods and services at reduced rates.
When technology has given its shield to this rather traditional method, the reach and response of P2P economy are soaring new heights. Fintech has added efficiency, real-time functioning and interactive transaction to the routine life of the public. You might be standing at the billing counter of a supermarket after a heavy shopping, waiting for the turn to pay. Turn on the internet connectivity and the P2P travel application; give your location and destination. Within minutes, by the time you reach the road with the bags, your taxi would have arrived.