Lendtech trio win £2m prize to create better UK renting realm
The UK government has given £2 million to three start-ups as part of its effort to help renters unable to get a mortgage because of their lack of a credit rating.
“Monthly rent is often the biggest expense that people face”
CreditLadder, Bud, and RentalStep have each won a share of the prize fund, as part of the government’s Rent Recognition Challenge.
The Dragons’ Den style challenge tasked entrepreneurs to create a simple way for renters to record and share their rent payment data, to help them improve their credit score. The three winners will use their funding to further develop their businesses.
John Glen, Economic Secretary to the Treasury, says: “Monthly rent is often the biggest expense that people face. Yet most lenders are unable to take it into account when working up a credit score. Three pioneering start-ups have found a solution, and we’re giving them the investment and support they need to help millions of renters across the country achieve their dream of owning a home.”
Launched in December 2017, the Rent Recognition Challenge provided an initial round of grant funding to six budding businesses to help turn their ideas into a workable product. A panel of judges then whittled the six down to three, who today (15 August) receive a final package of government funding.
The government explains that currently, a history of meeting rent payments is not routinely recognised in credit scores, and is not commonly considered when banks conduct mortgage affordability assessments – creating a barrier to getting onto the housing ladder.
Open banking platform Bud is building an artificial intelligence (AI) driven rental recognition tool. It will allow banks to integrate it into their apps so that people can use their rental history to help them do things like apply for a mortgage.
CreditLadder allows tenants to report their rent payments. Landlords and letting agents can also introduce their tenants to the platform.
RentalStep is a landlord-tenant matching platform, which allows landlords to purchase a tenancy management service through the platform, and rental payments to be tracked and reported.
