The cost of living crisis and the financial hardship it brings can have a significant impact on individuals and families, making it difficult for them to fulfil their financial obligations, including rent payments. Housing associations play a vital role in providing support during these challenging times. By offering payment choice, landlords can provide the flexibility and assistance tenants need to navigate financial challenges.
In this article, we will explore five ways that payment choice can help. Discovering how offering a variety of payment options, from traditional cash payments to innovative solutions like open banking, can effectively assist tenants in these difficult times.
Housing associations serve a diverse range of tenants with unique needs, and it is crucial for them to address this diversity, particularly during challenging financial times. By offering a variety of payment options, such as online payments, Direct Debit, and open banking, housing associations can cater to the entire spectrum of their tenant base. However, while digital methods like online payments and Direct Debits are convenient for many, it is important not to overlook tenants who prefer cash payments.
Some individuals may lack access to bank accounts or online banking facilities, making cash their preferred choice for making payments. In fact, in response to the cost of living crisis, there has been a notable increase in individuals turning to cash as a means to manage their finances, with a report from UK Finance highlighting that in 2022, cash usage had risen for the first time in over a decade.
Aligning closely with supporting diverse tenant needs, by offering a range of payment methods, housing associations can enhance financial inclusion among their tenants and foster a sense of stability and security.
By providing diverse payment methods, housing associations can accommodate the varying financial circumstances and preferences of their tenants. This inclusive approach ensures that tenants with limited access to traditional banking services or digital payment platforms are not excluded. Moreover, offering different payment methods can provide valuable data that helps tailor payment plans and support programs to align with tenants' specific needs. By promoting financial inclusion, tenants become empowered to manage their finances more effectively and create an environment of financial well-being for all.
In times of financial hardship, tenants may experience irregular income or unexpected expenses. By offering payment choice, housing associations can provide much-needed flexibility in payment schedules. Tenants can already select from weekly, bi-weekly, or monthly payments based on their income and cash flow, but to alleviate financial stress and help tenants avoid falling into arrears, accommodating individual circumstances with bespoke payment schedules can effectively support tenants in maintaining stable housing and help navigate them through the challenges of the cost of living crisis.
Payment choice, particularly through digital options, empowers tenants in managing their finances effectively. Online payment platforms and mobile apps offer convenience by enabling tenants to schedule payments, set up automatic reminders, and track their payment history. This transparency and control provide tenants with the tools they need to budget effectively and stay on top of their financial obligations.
Offering a variety of payment choices, including digital options, can streamline administrative processes for housing associations. Online payments and Direct Debits minimize unnecessary staff time and double keying of information. Furthermore, integrating open banking payments can automate financial assessments and streamline income verification procedures. Embracing digital payment solutions allow housing associations to enhance operational efficiency and allocate resources more effectively, enabling them to better support tenants .
To effectively support tenants during the cost of living crisis, it is important that housing associations review and adapt their payment processes to most effectively support tenants. By offering a variety of payment choices, such as cash options and innovative solutions like open banking, housing associations can meet diverse tenant needs and ensure that tenants can make their payments more easily and comfortably.
This approach enhances financial inclusion, provides flexibility in payment schedules, empowers tenants in financial management, and streamlines administrative processes for the association. Ultimately, payment choice enables housing associations to better support tenants through the cost of living crisis, fostering financial resilience, and establishing an inclusive and supportive environment.
The squeeze on social housing budgets has been relentless over the past few years, so the sector is continually looking at new ways of freeing up capital for investment and support of local communities and those in need of housing preparations.
One of the key advantages of using Direct Debit is its lower incidence of payment failure compared to credit cards. Nevertheless, Direct Debit is not immune to payment failures, and when they occur, they can significantly disrupt cash flow. Find out how to deal with Direct Debit failures in our blog.
By embracing Open Banking as a new payment option, you can enhance convenience, improve financial inclusion, and streamline operations, ultimately benefiting both your residents and the organisation. Find out how in our blog.