New pricing for Client Money Protection scheme

Safeagent, the not-for-profit accreditation scheme for lettings and management agents, is overhauling the pricing structure of its Client Money Protection (CMP) scheme, with smaller agents in mind.

The changes will result in the majority of accredited firms either saving money or not seeing any increase on last year, particularly benefitting smaller firms and new entrants into the market.

The existing structure offers three pricing bands – for firms holding ‘up to £500k’; ‘£500k-plus to £1m’; and ‘£1m-plus’ in their client account(s).

With immediate effect, the new structure introduces six bands with pricing for firms in the ‘under £50k’ and ‘£50k-plus to £100k’ bands paying 20% and 13.8% less respectively than last year.

A fairer system

Commenting on the changes, Isobel Thomson, Chief Executive of Safeagent, said: “The market has matured since the introduction of mandatory Client Money Protection in 2019 and we have worked closely with our insurers to secure new pricing which supports small firms and new entrants into the market.

“Under the current system, a new agent coming into the market starting from scratch with little or no clients’ money in their client bank account is spending the same amount on CMP as an agent with £500,000 in their account. This doesn’t seem fair; we feel the new rates are proportionate and balanced and differentiate fairly between the levels of clients’ money held.

“This is a further example of Safeagent listening to agents, focussing on what they need, cutting their costs and helping them perform their role.”