Mohamed El_Erian writes:\u00a0 The more I use Uber, the more I am convinced of the transformational power of recent technology innovations, especially when it is intelligently combined with behavioral science and economic principles. Indeed, it is only a matter of time until this potent mix disrupts an increasing number of industries, including certain segments of finance.<\/p>\n
By finding a powerful way to improve the well-being of both passengers and drivers, Uber is transforming a mode of urban transportation that, for a long time, has seen little positive evolution in the provision of service. Passengers get more than a pleasant phone interface to order their rides and monitor their progress. We feel incredibly empowered and enabled. We like that the fare is billed directly to a credit card that the company has on record; and that our feedback is solicited immediately and in a user-friendly manner.<\/p>\n
These are just some ways in which Uber has combined technological innovation, mobility and behavioral science to widen and deepen how it acquires and retains clients. And such insights are also being applied to the drivers, who are also empowered and enabled.<\/p>\n
Once drivers pass their evaluation, Uber provides them with the needed setup, including the technology for location services, billing and so on.<\/p>\n
The number of drivers signing up with Uber is growing markedly, enabling the company to offer its riders an expanding option of vehicles and service levels. Moreover, through the use of the \u201csurge reminder,\u201d which better calibrates fares with demand-supply imbalances, Uber can entice more drivers to come out at busy times. And this is only one way that the company is using basic economic principles to be more responsive in providing services.<\/p>\n
In analytical terms, Uber is a growing P2P (peer-to-peer) platform that is dismantling barriers to entry in a comprehensive way — so much so that even the old-style limousine services and taxis are starting to sign up with Uber as a means of supplementing their traditional business.<\/p>\n
Elements of this model are slowly being replicated in certain parts of finance, and will probably expand in the years to come — especially in providing more appropriate consumer credit to underserved segments of the population.<\/p>\n
By reducing old-style overheads and other outmoded costs, as well as using access to broader sources of loanable funds, P2P models can pass savings on to borrowers through lower interest rates while also providing an attractive return to creditors.<\/p>\n
And by using a broader set of data, this new group of financial intermediaries can improve on traditional credit models and better customize the provision of products to borrowers — a process that can be further enhanced with incentives to improve the paydown of debt balances and overcome debt traps.<\/p>\n
Mohamed El_Erian writes:\u00a0 The more I use Uber, the more I am convinced of the transformational power of recent technology innovations, especially when it is intelligently combined with behavioral science and economic principles. Indeed, it is only a matter of … Continue reading ![\"Uber](\"http:\/\/www.w-t-w.org\/en\/wp-content\/uploads\/2014\/10\/Uber-Business-Model-300x201.jpg\")
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