Tenant referencing is on the brink of a major breakthrough that will significantly alter the way landlords and letting agents vet tenants, it has been claimed.
It’s been brewing for over two years since the EU’s Open Banking regulations went live, but 2021 is likely to be the year when the tech, and tenants’ acceptance of its principles, breaks through, says Freddy Kelly (pictured, above), founder of Credit Kudos.
“More and more data is becoming available about people that enables platforms like ours to understand people’s debt, rent, pensions and other payment commitments,” he says.
Also, lockdown, and people’s greater use of online banking as traditional banking and referencing have become more difficult, means millions of tenants are now getting to grips with the concept of Open Banking.
This is tech that enables tenants to let platforms like Credit Kudos to anonymously read their bank accounts and record their rental payments, among other things.
Live since January 2018, anyone who has an account with the leading high street banks can choose to share their personal finance track record with a tech provider.
Landlords, who in the past have had to rely on references from credit ratings agencies, banks, employers and previous landlords, can now see if a prospective tenant has paid their rent on time and in full in the past.
Kelly, whose firm recently signed a major deal with lettings platform Goodlord, says his tech means Credit Kudos can gauge both a tenant’s ability to pay the rent for a property, but also their likelihood of paying it in the future.