Rent recognition service CreditLadder is now recording more than £100m of payments from tenants.
The service, which launched in 2016, links with landlords and agents to report rental payments to Experian and help boost their credit rating.
The idea is that keeping up with rental payments will boost a tenant’s credit score and make banks more willing to approve mortgages as it shows they can pay their rent on time, although there are doubts as to how much reliance lenders take of the score rather than the report itself.
Sheraz Dar, chief executive of CreditLadder, said the platform has been helped by the launch of Open Banking, which makes it easier to obtain and share data with lenders.
Dar said: “We believe that this extraordinary milestone for CreditLadder is proof that rent reporting is rapidly becoming an essential part of many tenants’ strategies when looking to access finance and planning to get on the property ladder.
“We’ve helped our users get on to the ladder which is a great testimony to the work we’ve been doing.
“We have also been encouraged by the Treasury’s recent announcement that it wants to work further to push the rent recognition agenda.”
£100m of rent represents less than 0.17% of the annual rents paid by tenants in the UK (assuming UK total rental payments = £60bn). To date not a single tenant has their rental payments recognised in the credit scoring algorithms used by lenders.
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