According to the Residential
Landlords Association (RLA), Zero Deposit is ‘the only deposit
replacement product recommended by the RLA to its community of over 35,000
a deposit replacement insurance product is becoming a key part of the lettings
process for landlords and lettings agents across the UK.
Benefits of replacing deposits with an FCA-regulated insurance product is intended to relieve tenants of the financial pressure to produce deposits, provide greater security to landlords, and offer a safer process for both landlords and tenants.
disadvantage of the policy is that is requires a one-off payment of one week’s
rent, plus a £26 admin fee. Whilst the upfront payment is now cheaper, much
less than the maximum
of five weeks rent required as a standard deposit, it is a sum of money
that good tenants – ones which are likely to get their full deposit back at the
end of the tenancy – will lose out on.
Andrew Dixon, chief
executive of the RLA, said: “With the average deposit now more than a thousand pounds,
deposit replacement products are growing in popularity with both landlords and
tenants. Our new partnership with Zero Deposit will allow us to extend this
alternative option to our members alongside our traditional deposit protection
Jon Notley, Co-Founder
and CEO at Zero Deposit, comments: “Since launching in February 2018 our deposit replacement
guarantee has proven to be incredibly popular with both landlords and tenants –
with several thousands already signed up.
“In May alone
we have covered more than 1,750 tenancies, providing more than £2m in deposit
cover to landlords. By working with the RLA we hope to build on this success
and increase awareness of Zero Deposit to its growing community of landlords.
“We also welcome
the RLA’s decision to partner with a product that is fully regulated by the
FCA, with safeguards in place for both landlords and tenants.
recently witnessed other deposit replacement providers enter the marketplace,
some of which do not offer the protections of FCA regulation and who are, in
our view, opening up this new market to risks of mis selling and ripping
replacement increasingly becomes the norm for renting in the UK, we urge Zero
Deposit is a trading name of Global Property Ventures Limited registered at
Business & Technology Centre, Bessemer Drive, the industry and customers to
insist on only embracing products that offer all customers the safety net of
FCA regulation, with protection under both the Financial Services Compensation
Scheme and the Financial Ombudsman Service.”