The rise of sharing economy businesses such as car sharing company Zipcar, accommodation community marketplace Airbnb and journey pooling venture Lyft has led British powers to seek an understanding of what more can be done in the space.

The concept of the sharing economy is based on the premise of people sharing assets such as property, time and skills – even if they do not know the other individual(s).

The government, headed by business and enterprise minister Matthew Hancock in this instance, wants to gain a better understanding of the situation and then make recommendations for how it can be developed.

Citing figures which suggest that 25 per cent of UK adults are sharing online, against a backdrop of market which could reach £230 billion per year by 2025, the review will make recommendations based on working out issues such as challenging and defining the concept of the sharing economy.

Led by Debbie Wosskow, who set up sharing economy business Love Home Swap in 2009, it will additionally look at what the benefits and risks to the UK could be, what issues are being faced by sharing economy firms, the ‘barriers to digital trust’ and what needs to be done for its potential to be met.

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Wosskow says, ‘Collaborative businesses such as Airbnb and BlaBlaCar are attracting much attention, significant investment and disrupting traditional business models across a board range of sectors – as well as generating a degree of regulatory changes.

‘The focus of the review will be on three well-established areas – personal and commercial space; transport; and time and skill sharing. It will also look at sectors where there is significant growth potential, including fashion, food and personal items such as power tools.’

Research carried out by professional services firm PwC in August 2014 showed that while the sharing economy is worth £9 billion globally now, the five key sharing economy sectors could generate that amount in the UK alone by 2025.

Hancock, who announced the review during his speech to the Conservative party conference, believes that there is ‘huge economic potential’ for the sharing economy and has an ambition to make sure that the UK is competing with the likes of San Francisco to be the home of choice for young tech start-ups in the area.

‘By backing the sharing economy we’re backing the innovators, the competitors and the agitators,’ he adds. ‘We’re making sure that Britain is at the forefront of progress and by future proofing our economy we’re helping to protect the next generation.’