How to create a secure and convenient P2P marketplace: functionality, development costs and real cases

Global e-commerce is experiencing a boom in the development of marketplaces: according to Digital Commerce 360 research, the market has literally doubled in the last 6 years, and preliminary estimates suggest that the total value of the top 100 companies will reach $3.832 trillion by the end of 2024. In the US alone, total platform revenues will reach $1.2 trillion.

Most marketplaces are based on the B2C principle, where the company itself is responsible for organising sales and interacting with customers. P2P platforms are also developing in parallel. Their main difference is that they are used by private sellers and that the items they offer are personal items or services.

We will also provide examples of our experience as experienced e-commerce marketplace developers.

P2P (peer-to-peer) marketplaces allow users to buy and sell goods or services directly to each other, acting as both sellers and buyers. They date back to the 1900s, when eBay and Craigslist started as auctions where users could trade with each other and buy second-hand and rare goods.

According to Future Market Insights, the global P2P marketplace market will be valued at $1,526.2 million in 2024 and is expected to reach $8,474.8 million by 2034, registering a compound annual growth rate (CAGR) of 18.7%.

In a standard marketplace, all processes are centralised. You buy goods from a company, not from an individual. The marketplace accepts payment and the company sends the goods to a delivery point or directly to the customer. Money is taken from your account immediately, but if you are not satisfied with the quality of the goods, you can always get your money back. In case of a dispute, you can always contact the company directly or involve the marketplace representatives.

P2P transactions can expose participants to the following risks:

Consider the tools and features we offer as an experienced marketplace development company.

In 2024, we completed the development of a marketplace for the resale of luxury clothing and accessories. Let us tell you what tricks and tools helped us secure transactions for this project.

Both sellers and buyers use the same account. To register, simply provide your contact details, username, email and password. You will then need to link your bank card to your account.

The seller fills in a simple form: category (men, women, children), brand, condition (new, excellent, good), photo, video, price. There is a function to upload a video for a better presentation of the product. The main feature is the calculation of the average market price for each item, which allows you to avoid dumping. The technology works like this: the seller describes the product and indicates the price, after which the system compares it with offers on other sites. During the moderation process, the platform administrators also check that the seller is really selling an original brand and not a fake.

The buyer can buy the product at the seller's price or offer their own price using the 'Trade' function. There is a question and answer section for all users to discuss the terms and conditions. We have decided not to include online chat in order to prevent the transfer of personal data and attempts to complete a transaction outside the platform.

The buyer pays for the order in full or in installments. The funds go into the platform's system and are held until the transaction is completed. You can buy goods from multiple sellers in one order – the transaction is split between them and the marketplace automatically receives the total commission. It is non-refundable, even if the buyer cancels the order.

Delivery is by courier service with automatic order creation and order status tracking. It is paid for separately. Each stage is strictly controlled by the marketplace's administration and the buyer and seller are kept informed of the progress of the delivery. Once the buyer has received his order, he confirms that he is satisfied with its quality. The seller receives payment.

The main target group of P2P platforms are private sellers and start-up entrepreneurs. For example, artisans and producers of handicrafts. Unlike traditional marketplaces, they need the simplest and most intuitive interface possible to quickly post ads and track sales and revenue.

Unlike traditional marketplaces, P2P platforms offer users two roles within one account: the same person can be both a seller and a buyer. But sometimes these roles are still separate. For example, Uber offers two types of apps to its audience: one for drivers and one for passengers.

Let us tell you about the functionality of our personal account, which we designed to create another marketplace – the Godno project, where you can buy goods from local producers. We followed the Etsy model, but added many of our own features for a software development marketplace.

When registering, the user chooses the status in which he/she will sell. For example, an individual or an entrepreneur. Each has its own KYC (Know Your Client) verification process. A private seller provides contact details and a card number to receive payments. The business owner fills out a detailed form and verification takes place through integration with the local data server, which contains information on all registered legal entities.

The Godno system has integrations with popular courier services. The cost for this is calculated automatically. The seller can also choose the 'Other way' option – pick up or deliver the order himself.

Each seller has their own page on the site with product descriptions and the ability to order quickly. To showcase products, we created a beautiful grid in the interface – inspired by pins on Pinterest. In addition to images, sellers can also post video reviews of products. Their previews are played with beautiful animations. Simply upload the content and it is automatically loaded into the product card preview.

The seller manages the status of each product in the catalogue: indicates whether it is in stock or available to order, sets up discounts and additional order options – choice of colour or size. Each product is moderated before being published. A preview function is available to adjust the design of the page. During the holiday season, sales in the shop can be paused - an announcement appears on the shop page and the system does not accept new orders.

This section provides full details of all sales and transactions for each seller. The user can see how many items have been bought, how much profit they have made, taking into account the commission of the Godno marketplace itself. Filters can be used to search, data can be imported into an Excel spreadsheet and an e-cheque can be sent to the buyer. If the buyer is not satisfied with the quality of the goods, he can request a refund using the option provided by P2P payments software development.

Users are leaving more data online and shopping more actively online. In the UK, more than 80% order goods from online shops and marketplaces, and this is expected to rise to 86% by 2027. In the US, 81% of customers shop online. In today's marketplace app or website development, the following features are responsible for user experience and security.

The technology is based on temporarily storing the amount of the transaction in the P2P platform's internal account until it is successfully completed. The process is as follows: a buyer selects a product or service on the platform and makes a payment. The money goes into a special escrow account in the marketplace system. Access to the account is blocked until the buyer confirms that the quality of the product or service is fully satisfactory. The seller then receives payment automatically. If there is something wrong with the order, the buyer must provide proof – photos of the condition of the goods or screenshots of correspondence with unfulfilled agreements.

Integrating escrow services increases user loyalty to the platform and reduces the risk of fraud. One of the most popular solutions is Escrow.com. It offers full integration with eBay and Shopify platforms and is licensed to operate in most US states. In the UK, Transpact, a service regulated by the FCA (Financial Conduct Authority), is used for transactions. European marketplaces most commonly use integrations with Trustap. This marketplace development solution ensures the security of face-to-face transactions and easily connects to Android and iOS apps.

The POS system should not only support popular payment methods (PayPal, Stripe and other solutions), but also automatically split the transaction, with the main part going to the seller and the commission to the marketplace account. In this case, all participants receive their money only after the transaction has been successfully completed. It is important that all transaction details are stored on the platform so that they can be referred to in the event of a dispute. Data from the POS system can also be used to analyse popular products and categories to create reports and guides to help users sell their services better and the platform owner earn more from new transactions.

P2P platforms are increasingly offering online loans that require an agreement with a partner bank. The user simply leaves an application in the marketplace system, the system transmits the data to the bank and then forms an approval or rejection. The full amount is immediately credited to the seller's account.

When registering on the platform, users must provide their name and contact details. After passing the verification process, they are given access to the platform's functionality. It is also important to provide a rating and feedback system that will influence the reputation of sellers and buyers. For example, after each completed transaction, both parties will be asked to rate or comment on what they liked or disliked about the interaction. Other users will be able to base their buying or selling decisions on this feedback.

Even if you don't have your own delivery service, you can integrate with third-party couriers. There are several development pitfalls here. The cost of delivery varies depending on the size of the goods and the buyer's address. Therefore, when developing the shopping cart functionality, you need to provide separate fields for entering these parameters and make them mandatory by default.

The system then automatically calculates the delivery price according to the specified parameters and adds it to the total order. The payment is divided into three parts, with the partner service receiving its payment in addition to the seller and the marketplace owner. For the convenience of the user and the transparency of the processes, it is also possible to track the delivery status.

A more complex option is to develop an online chat room where the seller and buyer can clarify the necessary information and discuss the details of the transaction. In the Polymertorg case study, for example, we moved the communication to the customer's profile. The solution works like this: a person writes a message, the seller receives a notification, goes to the profile and replies. The customer also receives a notification – in messenger, for example, using the Telegram Mini app. He enters his profile and continues to communicate.

You can also integrate an AI message detection system into the chat system. It helps to moderate chat conversations, preventing the spread of spam, scams and other content that violates the P2P platform's policies.

You need to monitor not only the actions of the users themselves when creating a marketplace website, but also the content they post. Where previously ads and comments were monitored manually, it is now possible to automate this process using machine learning algorithms. To do this, examples of suspicious actions, offensive language and other criteria must be loaded into the model against which each piece of content (descriptions, photos, reviews) is checked for compliance with the platform's standards and policies. If the AI sees that one of the users is trying to deceive another, a warning message will appear in the correspondence.

Let's start with the basics – the MVP of your future platform, for which you'll need

You can customise and extend the P2P-marketplace as you wish. Here are the approximate costs for the main options:

The final cost depends on the complexity of the marketplace functionality and the number of integrations you want to connect to it.

One of the reasons for the rapid growth of P2P marketplaces is the spread of the idea of the sharing economy, where people are willing to share resources with each other on favourable terms. As a result, this business model is actively developing in sectors such as property rental - AirBnB, transport – Blablacar and Uber, freelancing – Upwork. In recent years, the resale of luxury goods has been actively developing: McKinsey predicts that the global market for the resale of designer goods will grow by 10-15% per year until 2030.

Let's look at the key trends that will help you to create a marketplace website from the ground up, make it relevant to users and help you stand out in the market.

The use of artificial intelligence technologies helps P2P platform owners in the following areas

According to Shopify, 86% of shoppers use smartphones to shop online. The mobile commerce (m-commerce) market continues to grow and is worth over $550 billion in the US and £100 million in the UK. This has led to the development of mobile applications that offer users the following benefits.

Gamification is becoming an important tool for user engagement and retention:

Many P2P platforms are based on the concept of sustainability and promote ideas of conscious consumption. Some of the most relevant techniques are:

The launch of P2P platforms involves several monetisation options:

If you want to order the development of a P2P marketplace, don't forget it:

Don't forget scalability: if the platform starts to grow rapidly, it needs to be able to handle a heavy load. That's why it's best to choose an architecture and stack that can easily adapt to new features, and think about integration with third-party services. Our portfolio of success stories and extensive experience in cross-platform development on React Native allows us to think ahead and be e-commerce marketplace developers that are ready for any change.