Insurance based tenancy deposit scheme Reposit back, available and expanding

Reposit, first of the tenancy deposit replacement schemes, has returned to the market – declaring that it never really went away.

Reposit, founded in 2015, allows tenants to purchase a ‘reposit’ with one week’s rent plus an annual fee of £30, payable if they stay more than a year in the property.

The landlord becomes a named beneficiary on Reposit’s insurance policy and is protected for up to six weeks’ rent for anything a conventional deposit would cover.

Questions have been asked, however, about tenants’ behaviour when replacement schemes are used. Does the tenant – knowing that the money they have paid is, unlike a conventional deposit, always going to be non-refundable – have less respect for the property when they live in it?

In short, do they leave it a tip and then refuse to pay for any damages or cleaning up – costs which can be deducted from a conventional deposit?

Reposit’s analysis found some reassuring results: 17% of ‘reposits’ had some kind of charge, compared with 30% of traditional deposits; there was a 4% default rate, where the tenant had not paid for damages or cleaning and which Reposit’s insurers had to settle; and there was a 2% dispute rate over what was payable – the same as with conventional deposits.

This morning Reposit has announced a new £500,000 investment round, with backing from Weisz Investments and Avonmore Developments, to power further expansion and the development of new products. It brings the total amount of backing raised to £950,000.

Reposit has also entered a new partnership with insurance firm Canopius.

With 200 branches now offering tenants the Reposit option, the company has also researched 1,000 tenants’ attitudes towards traditional deposits.

It found that 91% had had to pay a deposit, with 49% saying that they had to borrow money to fund it – with some even taking out payday loans.

A major difficulty was the need when moving homes to pay a new deposit before the old one had been released.

Co Founder Julie Greer said: “Everyone at Reposit has been a tenant and has felt the pain of trying to claw together a tenancy deposit to move into a new property.

“Paying for one deposit, and waiting for an old one to be released, really highlights a cashflow issue for a lot of people, and there is £4.5bn of dead cash sitting in tenancy deposit schemes.

“It’s cash that could actually have a massive impact if made available to tenants again.”


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