Building Consumer-to-Consumer Trust in e-Finance Marketplaces

Online market exchanges are usually characterized by uncertainty and risks. Establishing trust and providing trust-building mechanisms are thus crucial for marketplace providers to reduce uncertainty and risks of online transactions. Business models that focus on consumer-to-consumer (C2C) transactions are growing and prospering. For these business models, establishing trust between consumers is important. Research in e-Commerce has mainly focused on trust-building mechanisms between vendors and consumers, but did not pay as much attention to mechanisms to build trust between individual consumers on C2C platforms. The objective of this study is to empirically investigate and test trust-building mechanisms for C2C platforms using data from the e-Finance marketplace Prosper. Our results give empirical support that trust-building mechanisms such as structural assurances, economic and social cues, as well as content quality influence trusting behavior. We contribute to literature and practice by investigating trust building in C2C relationships. Our findings help online marketplace providers to build successful C2C platforms.