Getting agents and landlords to embrace ‘deposit alternatives’ or ‘zero deposit’ products has been a long slog for the clutch of companies involved, and that applies equally to Reposit, the company that can claim to have ‘started it all’ back in 2015.

Headed up by Ben Grech (main image, front row, middle) since 2020, the firm recently signed up leading London estate agency Martyn Gerrard, which now offers Reposit to its 2,000-strong lettings book.

“We have this sense both within the team and the numbers, of accelerating momentum,” Grech tells The Neg.

“A lot of Reposit’s journey in the early days was battling scepticism as well as getting the right insurance partner, building the tech and getting FCA regulated.

“But I think the negative connotations that come with insurance meant many agents were worried that if a landlord made a claim, the insurer wouldn’t pay out.

Many agents were worried that if a landlord made a claim, the insurer wouldn’t pay out.”

“We’re not an insurance product – we’re ‘insurance backed’ and consequently we wanted to make what we offer accessible, open to anyone who passes referencing and offer a super-slick onboarding experience – we’re not just cherry picking the best tenants.

“For example, we don’t have dynamic pricing based on a tenant’s risk profile – it’s the same conditions for everyone.

Tortoise and hare

Nevertheless, Grech admits it has been the tortoise in the ‘tortoise and hare’ race and that there have been a  lot of ‘hard yards’ including overcoming scepticism within the property industry.

“But adoption has really begun picking up since 2022 and the hard work is paying off,” he says.
Grech says this has come both from the build-to-rent operators who are always looking for a competitive advantage, and larger estate agents with big lettings book – both being attracted by the larger eight-week deposit cover the firm offers compared to traditional five-week cash deposits and Reposit’s pricing structure.

Adoption has really begun picking up since 2022 and the hard work is paying off.”

“We also offer a much ‘lighter’ approach to traditional cash deposits because the regulations and requirements like Client Money Protection that govern how agents and landlords must act when handling deposits don’t apply when using our service,” says Grech.

And as many agents will know from bitter experience, making any mistakes during the deposit protection process can invalidate and/or hugely delay the eviction process, something that will become more complicated and costly once Section 21 is abolished.

Higher stakes

“So I think agents now see that the stakes a lot higher – and that’s making our product more attractive,” he adds.
But does the data show that landlords are equally keen on ‘alternative deposits’ and that they are a good tool for agents to attract them?

“We don’t have hard data on that but anecdotally it’s clear that landlords like the additional cover Reposit offers, and when offered our product between 80% and 90% take it up,” he says.

One danger area for the ‘deposit alternative’ sector is how agents are paid and incentivised to offer their products – and several cases of tenants complaining about pressure selling – where tenancies are only made available to those who take out these products – have been highlighted by the BBC and Guardian. Both articles featured industry figures, including those from Trading Standards and Propertymark, voicing their concerns over the sector.

Tenant complaints

These tenant compalints were created in part by some Reposit competitors – including agents using their own products – charging ongoing monthly fees to tenants which, some argue, are equivalent to – over long tenancies – a cash deposit.

We have always believed that we must please the agent, the landlord and the tenant.”

“We don’t charge ongoing fees to tenants – we have always believed that we must please the agent, the landlord and the tenant because otherwise, the agent will stop offering our product and, because we want to be successful in the long term, that keeps us honest,” says Grech.

“We stop any miss-selling or other types of abuse because the transaction takes place only on our website and because we are a regulated entity and, more perhaps more importantly, I believe, we offer the best value to both tenants and cover to landlords.”