In the 21st century, life without ridesharing seems unimaginable. The rental and ride-sharing industry has a global net revenue of over $7.5 billion and about 53% of the population has an experience of trying ride-sharing apps. Clearly, the cultural and economic imprint of ridesharing is indelible. It is projected that the industry will grow at a rate of 16.4%, pushing the ridesharing valuation to 148.7 billion by 2024.
The steady growth in the industry isn’t to say that the industry is without its problems.
Problems of Rental and Ride Sharing Industry
The biggest resentment experienced by the industry is due to the centralization of resources and concentration of wealth and its accelerated by few giants in mobility and ride-hailing space. Tech companies these days raise capital, build monopolies quickly by burning cash, spending quickly on driver and customer and hence, exploit end users associated with their platform. Once these companies establish a monopoly, they exploit customers and drivers with inflated fares/ rates for higher profit margins.
Also, it has been reported that in 2016, ridesharing services accounted for only 1 per cent of the vehicle miles travelled (VMT) in the United States. This suggests that the ridesharing services have been used for somewhat limited and short-distance utilities. The rural market all around the globe has been underserved by the ride-sharing industry.
Blockchain in Rental and Ride sharing Industry
Blockchain is one tech dream, when adopted by rental and ridesharing industry can revolutionize the entire sector.
True Peer-to-Peer Rental and Ridesharing Industry:
The current rental and ridesharing industry is hugely centralized with companies like Uber acting as aggregators or a centralized clearinghouse to connect providers with customers. These centralized powerhouses own the entire infrastructure including servers and software, also, they dictate conditions for operation and service agreements. A survey published by MIT found that drivers employed with Uber and Lyft made less than minimum wage in their state.
Blockchain can act as a remedy to low wages as it would decentralize the entire ridesharing ecosystem enabling drivers and riders to connect directly. It would create a free market empowering customers to choose their driver based on price, quality, and other free-market factors.
Smart contracts, tokens, and cryptocurrencies for smart digital Rental and Ride sharing Industry:
Customers around the world often complain about huge non-refundable booking fee and added cancellation fee for not showing up on time to the vehicle’s location. This can be the result of poor communication between the customer and driver or often riders being charged for a driver’s incompetence. Smart contracts can be the perfect remedy for this problem.
By installing smart contracts with embedded base payment on predetermined conditions, customers can ensure that drivers get paid only when they deliver the rider to their destination. If a ride is being canceled by the rider then the contract could automatically release a small portion of the funds to the driver’s account.
With the advent of autonomous age, autonomous vehicle owners would be able to lease vehicles on a short-term basis by utilizing a blockchain-linked network for fleet tracking in terms of cost and logistics. The amalgamation of blockchain with GPS tracking, RFID processing, and smart contracts could facilitate the transactional aspects of leasing an autonomous vehicle. Car rental startups that run on a Blockchain enabled platform offer token pay, such as Bitcoin, to take care of transactions avoiding the hassle of fiat currency.
The adoption of Blockchain in rental and ridesharing industry surely assures of a sharing economy which gives people, working on that platform, access or ownership on that platform. Blockchain guarantees transparent ride with authenticated rider and driver, ensuring the safety of everyone involved.