Rent is the single largest reoccurring payment in people’s lives, and the RentMoola online global payment network allows tenants and owners to pay rent by credit card, debit card, and other means. The goal of the RentMoola solution is to take the hustle from the “check and debit only” approach that’s even today deeply embedded with the property management.
RentMoola was inspired by the everyday experiences of its founders, brothers Patrick and Philipp Postrehovsky, when paying their rent became a cumbersome experience, due to the fact that landlords generally demand only checks or debit payments, with no credit card options. That’s when RentMoola’s core value was born—solving the age-old problem of paying and collecting rent for tenants and landlords. This simple idea grew the company into one of North America’s leading Fintech companies, and RentMoola is changing the landscape of paying rent all around the world.
The Canadian Business Journal sat down with Philipp Postrehovsky, Co-Founder & COO, about how the company forever changed the way people pay their rent. “My brother Patrick and I always wanted to get into the business, and the idea was born when we had to use credit card cash withdrawal in order to pay the rent, while collecting credit card rewards” reminisces Postrehovsky. And that’s the RentMoola solution—why not let tenants pay rent using their credit card, and make the payments rewarding?
The brothers started to build the platform in 2012 and launched in 2013, and today, RentMoola has presence in over 400 cities across North America and the UK, with over 400 property management clients. RentMoola partners mainly with medium and enterprise property management companies with number of units, between 500 to 40,000+, and has over 225,000 units in the system.
The core value to using RentMoola is the convenience and rewards to the consumers. “The statistics show that most rent is still paid mainly by check, which lacks thorough security features, and it is inconvenient for the tenants as well as the property managers, because they have to manually process checks each month. Before we came along, there was no credit card payment option.”
The main reason for property managers not offering credit-card options was the high service fees for credit card option which would eat into their already tight profit margins. Here RentMoola flipped the servicing model around, and the service fees are actually paid by the tenants, not the property managers, while the tenants can take advantages of the rewards provided by their credit card and company’s own MoolaPerks™ reward program. RentMoola also pre-negotiated special rates with MasterCard and Visa, so the property managers can provide this service without affecting their already thin bottom line.
“When it comes to payment methods, the tenants can pay with credit card or e-check with a 1.75% for a credit card,” explains Postrehovsky. “The nice thing about that is that many credit cards today offer cash back travel rewards at about 2%. So in this case, using credit card payment actually pays the tenants to pay the rent. There is also no cost digital e-check option, and we have additional options launched depending on the market.”
“As we are in the money processing business, we are PCI compliant, and our platform is compliant from regulatory perspective, and follows the strict rules we developed together with Master Card and Visa. There were some regulatory challenges when we started, but we have met and overcame those,” says Postrehovsky.
A Lifestyle Brand
While the business is enabled by large property managements, the company’s core value is to serve as a lifestyle brand for the consumers. Tenants can enjoy the perks from their credit cards, but also, as RentMoola users, they are enrolled in MoolaPerks™ program that provides exclusive deals for travel, lifestyle, home services and other rewards redeemable across North America, UK and Europe. “We wanted to make the rent payment rewarding, so we partnered with over 100 different brands that offer deals to our users, from Telus and Rogers to Starbucks and Uber, clothing brands, restaurants, etc.,” says Postrehovsky.
The company has firmly established its footprint in Canada, and now focuses on rapid expansion in the US. With only a handful of competitors and over $500 billion in rent payments annually, the US market is far from being saturated. Once the company establishes further footprint in the US, Postrehovsky brothers intend further expansion in the UK. “This is a global opportunity, so we will move onto other markets afterwards.”
The Fintech industry moves at the speed of light, and Mergers and Acquisitions are common practice within the industry, so the company does not rule out a potential acquisition by a company that would provide the right synergies with RentMoola. “While we are not actively seeking to be acquired, but a number of industry players could eventually look at acquiring us,” concludes Postrehovsky.