What is a deposit replacement scheme?

In a deposit replacement scheme, the tenant pays a fee to cover the landlord against financial loss instead of making a cash deposit. With the Zero Deposit Guarantee, tenants pay the equivalent of one week’s rent plus a set up fee of £59.99 at the start of the tenancy and if they continue to live at the property, they will also pay a £17.50 annual fee. The landlord is covered for six weeks’ rent, and any end-of-tenancy disputes are handled by The Dispute Service (TDS): a trusted, independent dispute resolution service. Tenants who owe rent or are liable for damage must pay the landlord. If they do not, following a decision by TDS, Zero Deposit steps in, pays the landlord and recovers the money from the tenants