UK estate agents are increasingly charging clients for ID and anti-money laundering (AML) checks as mounting compliance costs reshape the industry, research from identity verification provider Credas Technologies has found.
A survey of 250 estate agents and property professionals found that 63% already pass on the cost of ID checks to clients, with a further 21% planning to charge for ID verification within the next year.
Small independent agencies now spend an average of £16,000 annually on compliance tasks, leading to greater interest in technology that can streamline operations and support cost recovery.
While 79% of firms have adopted digital ID verification, the survey also found that 64% still rely in part on manual document checks. When asked about the most valuable improvements brought by digital ID verification services, agents cited instant results (68%), better customer experience (56%), lower costs (48%), and integrated payment options (48%).
Tim Barnett, chief executive of Credas, said: “The cost of compliance is no longer something firms can absorb without consequence. Property professionals are telling us they need faster, smarter ways to recover these costs.
“Firms want to remain compliant, but they also need to protect their bottom line.”
Well, it’s quite understandable for an agent to pass on the cost. As it stands, it’s down to the agent to prove that the client/customer is who they say they are. But it should be the other way round, with the obligation on the client/customer to prove who they are.
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I think, for too long, agents across all disciplines have shouldered these additional costs, eating into margins etc, but theres only so much a business can take before it needs to pass costs on. I also agree that it should be the other way round and for the client/ customer to prove who they are.
I’d also be interested to see what the ‘average spend of £16000 annually on compliance tasks’ is made up of
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There should be a ban on charging prospective buyers a fee for ID checks. Confirming ID is the cost of doing business, it is not for buyers to pay the agent for their checks. The seller is the agent’s client, not the buyer, so it should be the seller who pays upfront per ID check or it is built into the agent’s fee.
The Tenant Fees Act 2019 was required because agents got out of hand. We need an equivalent for sales, which also bans referral fees from conveyancers. That way the terrible solicitors/firms who only get business because they pay hefty fees (not for providing a good service) might wither and die (professionally).
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Sorry, i dont agree. It should be up to the individual to prove who they are.
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A buyer can send the agent a copy of their passport and drivers licence, but if an agent chooses to get a third party company to do electronic checks then that should be up to the agent/client to pay for it, or allow the buyer to find their own supplier to verify ID.
It should not be a condition of accepting an offer that a buyer must use the agent’s supplier.
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There should be an id check that all agents can use. As it currently stands an id check carried out by one agent is not acceptable to another, that is crazy and leads to multiple checks and sometimes costs to the client or buyer.
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Agreed. We should be in a position where a buyer’s conveyancer can confirm their client’s identity.
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