With many tenants experiencing financial strain, it’s important that housing providers ensure that the payment provider they use can provide adequate support to the tenant communities they serve.
This depends on thinking more deeply about the role of a payment provider. It’s not just how you take payments, it’s also how your customers most often interact with you. Payment providers are obviously a vital component in the payment journey, for settling bills and making debt collection plans, but they should also add social value by supporting and giving confidence to your customers.
Using data to alleviate pressure
With the right payment provider and payment solutions, housing providers can gain data insights to protect tenants and optimise the customer experience using innovative technologies such as Open Banking.
Open Banking enables banks and authorised service providers to securely access users’ financial data, and has important applications beyond just taking and receiving payments. It enables visibility of data in real-time, with access to the most accurate data being critical to making well-informed decisions about lending and repayment. As well as this, and perhaps more importantly in terms of generating social value, this takes the pressure off tenants when it comes to potentially difficult conversations.
Private-sector customers can shop around and choose the providers that suit their preferences and needs but social tenants operate in a smaller environment. On top of this, tenants may be affected by the digital divide or find it difficult to understand and discuss their finances. When housing providers’ advisors can view up-to-date financial data, this can take the pressure off tenants to identify and prepare the information needed in advance and removes the possibility of human error associated with this. Instead, advisors can use data not only to inform decisions, but also to put tenants at ease and foster supportive discussions.
Digital technologies such as Open Banking can also be used to gauge affordability. During a time when it’s easier than ever to slip into unmanageable debt as the cost-of-living crisis takes hold, housing providers have some responsibility to look out for their tenants. This means ensuring they do all they can to prioritise debt avoidance rather than simply helping to manage increasing debt.
The visibility that Open Banking provides is instrumental in this, but there are more tools that housing organisations can use to ensure that they make the best decisions for their tenants.
For example, identification and verification checks can be done as part of the payment provider’s technical capabilities to heighten security for customers. Biometric solutions can be used to protect against identity fraud, while compliance solutions can ensure that Know Your Customer (KYC) regulations are met and customers don’t get swept up in loans they can’t afford to repay.
As well as this, housing providers should ensure that they use the data at their fingertips in intelligent ways to make tenants’ lives easier. Data should be used as the basis for formulating a personalised plan for managing payments, either by ensuring the timing and amount is feasible for tenants to avoid debt or by devising the best way to split debt repayments into manageable amounts.
It’s vital that housing providers remember that they are serving a vulnerable demographic. This means it is particularly important to build a relationship based on trust and support, in which tenants feel supported, empowered and informed.
Offering tenants flexibility is a key aspect of demonstrating to them that their needs are the housing provider’s priority. For example, this can be done by implementing payment technology into the housing ecosystem to enable tenants to choose whether they pay in person, by direct debit, via newer options such as Apple Pay or Google Pay, or through Open Banking.
The cost-of-living crisis has highlighted the importance of building customers’ trust. As fraud rises, customers are also growing increasingly concerned about keeping safe. According to recent research from UK Finance, 60 per cent of people worry about becoming a victim of fraud. Some users will feel safer using digital wallet or Open Banking payments because these are connected to the biometric security features, whereas others will feel safer taking the traditional route of in-person payments; recognising this variation and the role of individual choice is absolutely crucial.
With the right payment provider, housing organisations can improve their ability to protect tenants and optimise the customer experience. By working in the customers’ best interests, payment providers and housing organisations can offer digital technologies that will not only increase efficiency and accuracy, but will make a genuine difference to the lives of their customers.
Stephen Ferry is the managing director of Pay360.