By Mary Ward
The state’s tenants union says it is receiving weekly complaints about third-party payment platforms, expressing concern that desperate tenants were signing up for monthly fees on top of rent.
While apps such as RentPay and Rental Rewards, which charge service fees, have been on the market for a few years, Ray White agents are increasingly asking their tenants and landlords to use Ailo, a payment platform founded by former Ray White director Ben White.
More renters are being asked to sign on to third-party payment platforms, which charge services fees. Credit: Peter Rae
Ailo is not owned by or affiliated with Ray White, although more than 13,000 of its properties have now been moved onto the platform, which can also be used by landlords to pay bills and manage repairs.
“We are being contacted weekly by renters who are being pressured to accept this platform as a change to their existing tenancy contract, or at the beginning of a new move-in,” said Leo Patterson Ross, CEO of the Tenants Union of NSW.
Since 2011, NSW tenants must be offered at least one fee-free method of paying rent.
However, Patterson Ross said operators could legally place onerous conditions on that method, such as tenants being unable to set up a recurring payment without a surcharge.
On Ailo, an automated direct debit from a bank account incurs a 0.25 per cent fee, debit card transactions incur a 0.95 per cent fee and credit card payments incur a 1.5 per cent fee.
Emails from Ray White agencies sent to tenants either renewing their lease or moving into a new property informed tenants that to pay rent they would “need to download the Ailo app”.
Ray White’s property management CEO, Emily Sim, denied its renters were being forced onto the platform.
“We can always improve how we communicate and we will work hard to ensure we get the language right on such emotive issues as rent payment,” she said.
“Our renters have a number of rent payment options. Agencies make their own choices about payment choices and they are clear on the way in on a new tenancy.”
NSW Minister for Fair Trading and Better Regulation Anoulack Chanthivong said he was seeking advice from Fair Trading about the sign-up emails, adding it would be “hugely disappointing if agents are ignoring the spirit of the existing law”.
Ben White defended Ailo’s model, saying about a third of renters on the platform did not pay fees and noting the app waived fees for concession cardholders and sent notifications to renters two days before their rent was due. Ailo is also the first rent payment app to integrate with Services Australia’s CentrePay service.
White said very few of Ailo’s users paid the 1.5 per cent credit card surcharge.
“That is there as a choice for users; they use it for the [credit card rewards] points,” he said.
White added that, “like every new technology”, Ailo received a lot of user feedback, and their fees model was something they were “actively considering” at the moment.
Last Friday, the state government launched its public consultation on NSW rental laws, asking tenants for their opinions on issues including protecting their personal information and the payments process.
In its consultation paper, the Department of Customer Service raises concern that the current rules requiring at least one form of fee-free payment does not guarantee a “genuine free and easy way to pay rent”.
“The Department has received complaints from renters that, even though a landlord or agent offers a way to pay rent without fees, the method they offer is difficult to use. For example, it may require the renter to go to the agent’s office in person, or to pay by cheque or cash,” the paper read.
Chanthivong said he was concerned the rules about fee-free payments had not kept up with changes in the industry.
“Agents must offer a fee-free way to pay rent – that’s the law. There are real questions about whether this provision has kept up with changing technology and a changing market,” he said.
“We’re consulting now on changes to bring the rental market into the 21st century, including those that would strengthen this element of the law.”
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