‘Rent now, pay later (RNPL)’ is a program being offered to Dubai residents by a start-up in the UAE. The program, which is scheduled to go live in July this year, would allow residents to pay their annual rent in equal monthly installments using a credit card.
Typically, rent in Dubai is paid in one to six postdated checks, two to twelve months in advance. Tenants will be able to spread out their rent payments over a 12-month period thanks to the new RNPL platform from the digital real estate investment management platform Keyper.
Walid Shihabi, co-founder and CSO of Keyper, said that the platform will charge tenants a premium to pay their rent in 12 installments in an interview with Khaleej Times. The precise sum is determined by how many payments the landlord anticipates.
He gave the example of an apartment with Dh100,000 annual rent to be paid in four cheques. “Keyper would offer the tenant Dh105,000 in 12 credit card payments (Dh8,750 monthly), which equates to a 5 per cent premium to go from four to 12 payments,” said Shihabi.
How it works
The platform offers the tenant a new rate to allow them to pay in 12 installments. “Once the tenant has accepted the offer, we connect with the landlord and get their legal approval to offer this service,” said Shihabi.
The RNPL gives landlords the option of receiving their rent up front in a single payment. They are eligible for discounted upfront payment. “With or without their tenant accepting a Keyper RNPL offer, the landlord may take advantage of this offer.”
There are no additional costs for the landlord if the tenant accepts the RNPL offer but the landlord rejects the advance rent. In this scenario, tenants would pay in 12 installments (each with a greater premium), and the landlord would receive the rent according to the initial payment term, which might be either four or six months.
Once everyone is on board, the contract is digitally signed and the tenant’s payment card information is taken. The renter will have access to a personalized dashboard with email and SMS payment reminders once the lease is live. Through dashboards, tenants may keep track of their payments, add new credit cards, and read their leasing agreements.
The business is concentrating on new leases and lease renewals at this time.
What occurs if a renter breaks their lease early?
In some cases, tenants may need to terminate their leasing agreement before it expires. We adhere to industry standards and apply the notice time and cancellation fee agreed upon with the tenant at contract signing when a tenant wants an early termination of their lease.
The RNPL is not a loan and has no impact on the debt load or credit score of tenants. As Keyper RNPL enables renters to pay their rent in 12 installments at a higher rate while accepting the landlord’s stipulated terms, we are not providing a credit product.
Waitlist for pilot programme
Keyper is launching a waitlist for tenants to sign up in the pilot batch. “This means that we are serving tenancies starting in July 2023 … We have limited spots for the next few months. We are allowing tenants outside of our network to sign up to our waitlist and we will be selecting a few of them to be part of our pilot programme. For those that don’t make it to the pilot program, we’ll be gradually allowing more tenants (to be part of it),” said Shihabi.
Omar Abu Innab, co-founder and CEO of Keyper, said traditional cheque payments are outdated, prone to errors, and do not provide a good user experience for tenants or landlords. “We have designed our RNPL service to address these pain points and to enable our customers, tenants and landlords, to better manage their finance with ease.”
The company claims that landlords using the platform will probably see an increase in tenant retention rates and a decrease in default rates. The risk of missed or late payments is reduced by the tenants’ easy monthly rent payments using their credit cards.