Eqaro Guarantees, a rental guarantee provider has launched a one-0f-its-kind initiative – MyPrideMyHome.com to provide rental accountability and future tenancy. The innovative initiative provides a platform for landlords to address tenant financial defaults to help create a rental eco-system that fosters trust, transparency and promotes responsible tenant behaviour. There is a provision for rental bonds through which tenants get preferred tenancy. In this exclusive interview with Torbit Realty, Vikash Khandelwal, CEO Eqaro talks about the concept of rental bonds providing relief to tenants and protection to landlords, operational challenges and the company’s future growth plans. Excerpts.
Vinod Behl
Tell us about the concept of Eqaro Guarantees’ platform – MyHomeMyPride.com and how does it function?
Serving as a centralised hub, MyPrideMyHome.com is a technology-led platform that provides landlords a comprehensive tool to share and address the various types of financial defaults committed by tenants, including non-payment of rent, utility bills, maintenance charges or breach of notice and lock-in period. Through this platform, we provide an opportunity for landlords to contribute to the accountability of tenants in the rental ecosystem, mitigating risks associated with future rental agreements and influencing future availability of properties for defaulting tenants. We empower landlords with better decision-making capabilities to safeguard their valuable properties in a continuously expanding market. We offer guarantees in lieu of collaterals and cash on behalf of individuals, entrepreneurs and MSMEs recognizing their inherent, fundamental strengths and capabilities.
What are rental bonds and how these bonds help landlords and tenants?
Rental bonds are a prevalent concept in many developed countries. In fact, bonded tenants are the ones who have been thoroughly underwritten and with a demonstrated good tenancy track record get preferred tenancy terms from the landlords. In many countries, tenants may find it difficult to rent a house without a rental bond. However, this is the first time that the concept of rental bonds has been introduced in India. As of now Eqaro Guarantees is the only company that is offering Rental Bonds in India.
How these rental bonds offer legal protection to landlords against tenant defaults?
Rental Bonds provide the landlord with credit verified and assessed tenants. It also helps him rent out his property faster and earn higher rental yields. In the event of a default, rental bonds cover the landlords for default in payment of rent and utility bills, breach of lock in period and damages to the property. However, the bond doesn’t offer legal protection or cover legal fees incurred by the landlord. Having said that, we believe that a good credit verified and assessed tenant is less likely to default. Hence it reduces the need for litigation.
What are the operational challenges you face from bond holders and how are these resolved?
We are actively collaborating with several real estate associations, property management companies and co-living operators to understand and address various challenges in the rental market. We haven’t seen much of objections from the tenant community. We have however experienced hesitancy for landlords to adopt bonds. And rightfully so. Being a new concept, the landlords are curious about how the rental bonds would operate in different given scenarios. They do come around once they are explained about the merits of the rental bond and how it helps protect their interests.
We have met numerous landlords over the last few years. All that the landlords want is a good tenant. They are happy about the fact that only credit verified and assessed tenants are granted the rental bond and it works as a layer of security for them. Despite that if the tenant still defaults, the rental bond pays out to landlords. We have the largest data bank of defaulting tenants. The landlords benefit immensely from that as the tenants who have defaulted earlier would never qualify for a bond. With regard to meeting data protection challenges, we are adhering to stringent data protection measures assuring confidentiality and protection of personal and sensitive information.
What is the revenue model of your company?
As per our business model, by virtue of the rental bond, the tenant is no longer required to put up a security deposit with the landlord. The tenant however pays a fee to the rental bond company which is a small fraction of the security deposit.
Tell us about your current operations and future growth plans?
Eqaro is currently present in the cities of Mumbai, Navi Mumbai, Delhi NCR, Bangalore, Pune & Hyderabad. The response to the concept of rental bonds has been very encouraging and there are over 27,000 zero deposit properties across these locations. The company intends to expand its operations to other cities shortly.
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