With the cost of living crisis seeing more and more families struggling and providers needing to support those experiencing hardships, the importance of efficient and effective collection has never been greater.
According to a quarterly survey; mean rent arrears increased to 4.0% during quarter 1, 2020-2021 - the highest rate since 2013. A reliable process to assess things like affordability either at the pretency stage or collection stage is a key mechanism to ensure that tenants are advised appropriately, collection decisions are robust and arrangements sustainable.
Next-generation solution: Open Banking
Open Banking has opened up a world of possibilities for the payments landscape. By using verified information, Open Banking enables direct and instant payments between two bank accounts with much less risk of error or fraud. No input of sensitive data (such as card details) is required when making a payment.
Open Banking payments can be used for a variety of transactions, allowing councils to initiate instant and direct account-to-account payins and payouts, for example:
- Rent payments
- Service charge payments
- Former tenant arrears
- Fixed or variable recurring payments
Open Banking can also bring in many data capabilities, such as instant confirmation of account ownership or income verification, providing local authorities with fully accurate financial information extracted from a citizen’s verified bank account data. This technology introduces many key benefits that can transform the way local authorities work:
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