Supporting tenants ahead of Universal Credit
January 21, 2013
Housing associations involved in the Government's direct payment demonstration projects are right to offer their tenants a range of payment options in order to maximise rental income.
According to a recent Department for Work and Pensions survey of partial housing benefit recipients, more than 60% of the sample paid their rent in cash or with a rent payment card at a local outlet, while 17% paid by direct debit and 14% with a debit card.
It’s important to recognise that the move to pay benefits directly into bank accounts will not provoke an immediate reflex by tenants to set up monthly direct debits.
However, there are good examples – both inside and outside the demonstration projects – of landlords supporting tenants through the process. For instance, we are aware of one housing association encouraging residents to set up small direct debits e.g. £4 a month so their rent accounts are in credit come Universal Credit.
This gets them into the habit of managing automated payments with the risk of penalty charges minimised. Others have found success by offering direct debit collections on every date of the month – giving tenants the assurance that the rent can be aligned to when they know money will be in the account.