Pricing of platform service supply chain with dual credit: Can you have the cake and eat it?

Online shopping has become the main form of daily consumption, which contributes to the growing maturity of platform service supply chains (PSSCs). However, financial constraints of consumers and sellers have emerged as the key factors hindering their participation. To attract both sides on board and expand transaction volume, seller’s credit combined with buyer’s credit, or dual credit, has been launched by platforms. However, studies on whether this dual credit service is worth implementing remains to be an uncharted area. This paper aims to explore the e-commerce (EC) platform ecosystem with credit services, which is composed of a platform, a seller, and a group of consumers. By using game-theoretic approaches, our study finds that the dual credit drives down product price, which always profits consumers compared to the single buyer’s credit; platform charge, however, changes vaguely so that other agents are not always profited. For mid-to-high end products, platforms’ incentive in providing dual credit can be enhanced by raising seller’s capital or consumers’ dishonesty aversion coefficient, which also increases social welfare; while sellers engage in credit only when under severe shortage of capital. The effectiveness of raising consumers’ aversion coefficient in motivating the acceptance of financing services for sellers depends on the product type. Besides, for low-end products, the welfare of both the seller and the society always suffer, making the dual credit not worth promoting in this case.