Zoopla-backed deposit alternative unveils ex-ARLA president as official spokesperson

Zero Deposit has appointed former ARLA president Peter Savage as its official spokesman.

Savage has held various roles within ARLA Propertymark, including two terms as president in 2015/16 and 2018/19.

He remains a member of the Propertymark board, a position he has held since 2015.

ARLA itself does not back any individual deposit replacement products and has not endorsed the sector itself, but has issued a factsheet that calls for agents to conduct due diligence on the schemes and describes them as “relatively unproven”.

Savage said: “I have watched the growth of the deposit replacement product market with interest. It offers a fantastic opportunity for landlords and tenants alike, but as with any new industry, it is liable to rogue entrants too.

“Much of my career has been spent raising standards in our industry and placing consumer protection and transparency at the heart.

“In the deposit replacement sector, it is crucial that landlords are fully aware of the level and consistency of their cover and that tenants fully understand what they are and are not covered for when they buy a deposit replacement product.

“To ensure this is the case, I firmly believe that deposit replacement should evolve as a regulated marketplace, and I look forward to doing what I can to promote this message and all of the safeguards and protections that regulation brings.”

Peter Savage

The announcement came as Zero Deposit welcomed scrutiny of the emerging sector.

It was revealed during The Property Ombudsman conference this week that its consumer forum is frequently asked to look at deposit replacement schemes.

Jon Notley, chief executive of Zoopla-backed Zero Deposit, said regulation is needed in the market to protect users.

Different levels of regulation exist in the deposit replacement market, he said, with only a few offering Financial Services Compensation Scheme protection if they go bust and some having no authorisation from the Financial Conduct Authority at all.

Notley, who has written to the FCA to push for further regulation of alternative deposit schemes, said: “For many months, we’ve encouraged this level of scrutiny of deposit replacement, and more dialogue around the importance of FCA regulation. We strongly believe that the risks highlighted by TPO will emerge unless this new market develops responsibly.

“FCA rules exist to protect customers and the integrity of the market generally, including the reputation of those who distribute the products, in this case letting agents.

“Regulated products are required to offer good value and set out the risks to customers clearly before they purchase.

“Furthermore, letting agents are restricted in what they can do in promoting the product to ensure that it is not mis-sold.

“Worryingly we have seen unregulated providers position these restrictions as a disadvantage, when actually they are there to avoid tenants being sold a product that may not be suitable for them.

“When you consider some of the unregulated schemes that have emerged, and the terrible value for money they can offer to tenants, or the absence of contractually binding guarantees for landlords, we are not surprised that the TPO is seeing complaints.

“Landlords will assume agents have done their homework on their provider. If one of these schemes were to fail or get caught up in scandal, potentially leaving landlords with no protection, any agent who is seen to have recommended such schemes could find their reputation in tatters.”

Reposit has also backed further regulation of schemes to ensure tenants and landlords are treated fairly.

Its chief executive Jude Greer said: “Tenants should be allowed to make complaints if they have been mis-sold a product and/or the company was not transparent enough, and it is possible that there could be an uplift of complaints in our sector if proper procedures were not put into place.”

Greer said the solution to preventing complaints was FCA regulation and a “detailed onboarding process” to ensure agents understand how to introduce the product and how it applies to their tenants.

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  1. ChumpExecutive

    The conundrum here is that when consumers realise what they have actually been sold they will see it has negligible value. What is going to happen is this; early adopters of these schemes are going to start to see tenancies coming to an end. The tenants will realise they have been mis-sold and will hunt around for someone to blame – complaints will mount up at TPO** and on social media and then will hit the mainstream press. The FCA will wake up and decide that if something looks like insurance, smells like insurance and (in theory) acts like insurance then it is insurance and maybe unregulated letting agents should not have been selling it directly to the public in the first place. Meanwhile less financially stable providers of these schemes will start to come under financial stress, some will go under, others will be consolidated by the big, well-funded operators. Agents will rue the day and look at their (relatively) modest commission cheques compared to the stress and hassle of dealing with angry landlords with no deposits in place. I wish Peter well, its going to be a fun ride! I do hope he does not come to regret the decision given his spotless professional reputation to date.

    **TPO – what has it got to say on the commissions earned from these product sales? Up to half of the premiums being paid by tenants are being kept for the benefit of the agents bottom line. Is this being declared?


    1. Lil Bandit

      Do you work for the DPS or something? Seem very passionate on this issue, chump.

    2. MemyselfandI

      Spot on I’d say!

  2. Chris Wood

    I’ve met Mr Savage. An interesting choice that says a great deal about Zoopla.

  3. Mike Dawson

    Just a few questions;  Under the ‘Zero’ product, the tenant pays and Insurance Premium + IPT; what insurance cover are they purchasing? How does the 14 day cooling off letter work? Does the tenant receive this notice after they have moved in to the property? The potential for complaints must be most significant when the tenant is buying an insurance policy but has no insurance cover? Will ‘Zero Deposits’ disclose the highest commission rate that they pay to agents? I support innovation and I support new products that help agents, landlords and tenants in such a difficult market. What I find frustrating is this constant narrative from Zero that seems to go unchallenged…….. “every product other than ours is substandard” is marketing over substance, not backed up with facts. 


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