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A new report by PayPoint has shown that 30% of social renters are worried about their long term finances post Covid-19.
The digital payment provider conducted a series of surveys with both social and private renters.
25% of respondents are already at least a month behind on their rent, and a third are concerned about the impact Covid-19 has had on their long-term financial situation.
Encouragingly, 40% of social renters are confident their long-term financial situation will improve as the UK recovers post-Covid, and most of those who have fallen behind have found their landlord sympathetic and flexible.
Overall, private renters are more concerned about the long-term financial impact of Covid-19, and less than a quarter (24%) are confident in their recovery post-Covid.
Of the private renters who are behind on payments, 22% are concerned about their ability to catch up within the next 3-6 months, whereas just 10% of social renters shared these concerns.
Danny Vant, Client Services Director for PayPoint, said: “The global crisis has impacted virtually every area of our lives and the longer-term financial impact is becoming clearer.
"Our survey reveals real concerns over future financial stability and ability to pay rent. It is vital that both private and social landlords are sympathetic to the challenges their tenants are facing in these uncertain times.
"Offering payment flexibility will be important for tenants going forward, to help them navigate changes to their lifestyle and financial situation. This will ensure landlords can retain good tenants and continue to recover rent fees effectively.”
One in five of the renters surveyed said they would welcome the introduction of a digital payment platform that would remind them when payments are due and enable them to make flexible payments to help them manage their financial situation.
PayPoint’s new collection tool, PayByLink, available through digital payment solution, MultiPay, helps landlords to engage with tenants sensitively and responsibly via SMS and email, to remind them of payment dates, make arrears collections and offer flexible payment terms.
This will be particularly beneficial as the UK navigates it way through the financial impact of the COVID-19 pandemic.
Vant continued: “Late payment collection through PayByLink increases efficiency and reduces the cost of collections and write-offs.
"Tenants do not want to miss rent payments, but many facing significant challenges in the current climate have fallen into rent arrears.
"As our survey showed, many are very concerned about their ability to pay rent in the coming months, and how quickly they will recover, financially from the impact of Covid-19.
“Importantly, PayByLink provides tenants with payment flexibility, putting them in control whilst improving cashflow for landlords. The user-friendly payment options remove friction from the payment process whilst retaining security and peace of mind, increasing customer engagement and ultimately improving collections success.
"Working together with tenants, considering their financial challenges and providing payment flexibility, landlords can help tenants through this stressful time and may find they benefit from longer tenancies and more efficient payments in future.”