Direct Line Group has announced that it has taken a 15% equity stake in Canopy, a rental market disruptor founded last year, which is targeting the traditional rental market head-on.
Canopy’s service, which is based around a RentPassportTM, provides proof of an individual’s rental and credit history and their ability to pay rent promptly, in a bid to offer an alternative to tenancy deposits.
The service also aims to help both landlords and letting agents pre-approve renters, saving them time with the vetting process. In addition, it is a record of trust for renters and over time, this will give renters access to a range of insurance products based on a TrustScoreTM.
Adam Whiteley, director of household development at Direct Line Group, commented: “This transaction marks our latest investment in a Fintech company, building on our ambition to be at the forefront of advancements in the insurance landscape.
“The current rental model asks renters to pay deposits of several weeks' rent, and we believe Canopy’s use of mobile technology provides an innovative solution towards this. By re-engineering the UK’s rental market, Canopy are seeking to enable ‘Generation Rent’ to gain access to better financial services products while demonstrating how technology can be a positive disruptor.”
Tahir Farooqui, CEO and founder of Canopy, said: “We are excited by this financial investment as it supports the expansion of our business, which aims to improve every aspect of renting for all parties concerned – renters, landlords and estate agents.
“The days of the security deposit are now numbered, and we can now empower renters to become buyers far more quickly because their rent can now count towards their credit history.”