More and more people are adopting digital payments to pay rent to their landlords. And when paying digitally, credit card is the best option as it gives not only reward points but also a free credit period.
The nationwide lockdown has necessitated a lot of lifestyle changes for many of us and showed us our capacity to adapt to change. It has also ushered in some very welcome moves in our day-to-day living and changed the traditional ways of doing things.
Let us look at the transformation that the real estate industry has undergone in a matter of days. Changes which the industry stalwarts had imagined would only happen in distant future have happened overnight. For instance, we have come a long way from the time when a physical property visit was indispensable to finalize a property. There are numerous customers today who have finalized a property for rent via video walkthroughs!
One of the most sensational aspect of the change is the payment of rent via credit cards! Early movers in the space like NoBroker have already penetrated the space. But the current situation has necessitated a faster onboarding of customers on to the process. Rent is the biggest monthly expenditure for most of us these days. And while payment of rent via credit card helps us win a lot of reward points and the point cannot be stressed enough, Indian consumers have been slow in catching up with the trend. Three factors have, however, catalyzed the adoption of this method — the buffer period that credit card payments offer, fear or inability to handle cash payments, and unfortunately, the fear of layoffs.
A lot of state governments have urged landlords to not collect rent from tenants for the months of March-May 2020 as many people’s livelihoods have been impacted due to the pandemic. But this cannot be enforced, and it is up to individual landlords to either let go of three months’ rent or to postpone it or to find a middle ground.
There has been a sudden uptick in the number of people availing the service of rent payment via credit card. Credits cards offer the much-needed buffer period or flexibility for tenants to make the payment. It ensures that the rent gets paid to landlords in time and tenants do not have to face liquidity crisis. They get almost 45 days of free credit period.
Most customers do not want to do any cash transactions for the fear of infections that may accompany the notes. Moreover, the lockdown has made sure that no one can physically step out of their houses. That’s why more and more people are adopting digital payments to pay rent to their landlords. And when paying digitally, credit card is the best option as it gives not only reward points but also a free credit period.
We are going through difficult times and many companies are unsure if they would have to let go of employees to keep afloat as there is huge business impact of the current situation. Rent payment via credit card makes a lot of sense in such scenario given that the current crisis is temporary, and it makes sense to have extra liquidity till more clarity emerges. Until the time things return to normalcy, and the state of the economy is better, it is judicious to avail the liquidity avenues that digitization has opened up.
It is worth looking at the silver lining that accompanies the dark clouds. The way in which the transition has happened may not be the best one, the reason for the transition may be the worst one ever but it has helped Indian people make a giant leap. The pandemic has set into motion a more disciplined and a more efficient way of closing transactions. Once the situation is better and we hope that happens real soon, we would have entered a more efficient, a more digitally equipped era and it would only be to our benefit.
(By Saurabh Garg, Co-founder and CBO of NoBroker.com)