Proptech firm Canopy has teamed up with mydeposits to make it easier for tenants to pay their deposit into its custodial scheme.

Canopy, a tenancy deposit replacement provider which also offers a rent passport and rent tracking service, will now let tenants using its app pay their cash deposit directly and instantly to mydeposits.

This will save agents having to handle the money and reduce fees charged to landlords for the service, Canopy said.

Tahir Farooqui, founder of Canopy, said: “We’re thrilled to be partnering with mydeposits to give millions of renters access to the mydeposits custodial scheme.

“The partnership with mydeposits is perfectly aligned with our commitment to promoting greater financial health for the renter and will help us fulfil our vision of making renting work for everyone, initially addressing one of the core issues of the housing crisis – affordability. “

Eddie Hooker, chief executive of mydeposits, said: “Our custodial offering is already a popular choice for both landlords and agents.

“We are delighted to provide access to our custodial scheme via the Canopy portal.”

Meanwhile, rival firm Zero Deposit has signed up London agent Chestertons, which will offer the deposit replacement product across its 33 branches.

Zero Deposit said it is now offered across more than 700 branches in London with brands such Knight Frank, John D Wood, Acorn Group, Douglas and Gordon, Foxtons, Barnard Marcus and KFH

Richard Davies, head of lettings at Chestertons, said: “We met with several deposit replacement products over recent months in order to understand the differences between each of the providers and which match Chesterton’s service and standards.

“Zero Deposit stood out, not least because it is a regulated provider and we have the utmost confidence that the product is robust. We are seeing increasing demand for the Zero Deposit Guarantee from tenants and are responding to this.”

Ben Harris, commercial director at Zero Deposit, said: “We are delighted to have been chosen by Chestertons as their deposit replacement partner.

“We share many of the same principles, particularly the importance of regulation in protecting landlords, tenants and by association, our agent partners’ reputations.

“We’re gaining great traction not just in London but across the country.

“As agents become more comfortable with deposit replacement as an addition to their lettings toolkit, the conversation keeps directing back to how a deposit replacement partner guarantees protection for landlords and tenants, with our regulated and fully underwritten guarantee standing out from the crowd.”