How PayProp’s payment technology made property management profitable for Rent Panda

21st century payments

Rent Panda’s strategy for streamlining payment processing relies on pre-authorised debit (PAD) payments – taken directly and automatically from the tenant’s bank account. Instead of picking up cheques in person, processing them manually and waiting for them to clear, using PAD would let Richard and his team escape from the long and gruelling payment processing that prevented other agencies from making property management profitable.

From a process perspective, we want to make the business as efficient as possible,” says Richard. “It’s more work upfront to sign a tenant up for PAD, but after that it’s zero work to handle the payments in most cases. They have money in their account, it gets paid. Richard Togman, CEO

It’s a process that PayProp helps to facilitate by making it easier to reconcile rents and distribute the money once it comes in. With PayProp, invoices are sent to tenants two days of the PAD payment occuring and when rent is received, it is paid out to landlords and contractors according to rules that the Rent Panda team set in advance. Because PAD payments are matched to the right tenant and property automatically, payment takes Richard just a couple of clicks.

Despite the push for PAD, Richard also values the fact that PayProp allows tenants to pay with other methods.

“Over 90% of our tenants pay by pre-authorised debit. Any time we sign up a new tenant or an existing tenant will agree to it, we want them on PAD. We essentially make it part of the lease. The PayProp customer support team tell me that we use PAD payments a lot more than other companies – but we still have to accept other forms of payment,” he explains. “With some of our clients who are on social assistance, for example, they get physical cheques mailed by the government. It’s definitely a benefit that PayProp allows us to handle these payments with all the same features.”

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When he launched Rent Panda’s property management service, Richard hoped that solving the payments puzzle could lead to rapid growth. Almost a year on, the results speak for themselves.

Right now we’re managing around 90 doors, but that changes really quickly,” he explains. “We’ve been growing at a very fast rate. I think over the last three or four months, we’ve tripled the business. Richard Togman, CEO

“We’ve also now chosen to open a second account for our second location. We just recently started in Guelph, and we’ll likely be expanding to a third and maybe a fourth city in 2021 as well. At this point PayProp is pretty essential to our growth strategy.”

Rent Panda’s rapid rise is that much more impressive against the backdrop of the COVID-19 pandemic – but according to Richard, coronavirus hasn’t been an insurmountable problem for his tech-enabled business.

“It’s like we didn’t experience any difference. Having PayProp meant that nothing really changed process-wise,” he says. “When we shut our office and everyone started working from home, we didn’t have to invent new processes. Everything is digital and decentralised already, we have a whole tech stack. We track maintenance and repairs on Google Sheets and use Slack for all our intra-office communications.”

“Because we weren’t going to the banks and depositing cheques, we didn’t need the banks to be open. We didn’t need people going door-to-door taking cash payments because we weren’t doing that anyway.”

PayProp was like a built-in buffer that just kept everything humming along as normal – which for COVID-19 was the best thing that could have happened. Richard Togman, CEO