Real time benefits for lodging rental bonds electronically

1 June 2021


Lodging rental bonds online has improved the efficiency of settling funds making it easier for both agents and tenants, according to NSW Fair Trading.

Melinda Carter, Acting Manager Rental Bonds says the system, which was introduced in 2015, now accounts for around 75 percent of transactions.

NSW Fair Trading currently holds 928,000 bonds worth around $1.7 billion.

They want to see online lodgement increase to 90 percent; however, it relies on the tenant. Under legislation it is the person taking out the lease, not the agent or landlord, who decides on their preferred lodgement method. To complete the process electronically, tenants don’t have to be super tech-savvy, however they must have internet, email, mobile phone, an Australian bank account and an ability to pay by Mastercard, Visa or BPAY.

“If you can use online banking, you can use our online portal,” Ms Carter said.

Paper vs Online

The benefit of the online system is that it has real time notification. If a tenant or agent make a claim on a bond, the other party is immediately notified through email or SMS.

“It gives you more time to make an agreement rather than relying on the old paper system where notices are posted out,” Ms Carter said.

The online system enables the tenant and agent to start discussions straight away. In the event of these stalling, they can apply more readily for hearing at the NSW Civil and Administrative Tribunal (NCAT).

Ms Carter said lodging a bond online is also transparent and gives both parties accountability as required under legislation.

“The money is there, it is certain and guaranteed,” she said.

Agents’ responsibilities

Before the keys have been handed to the tenant, agents must complete the bond application, NSW Fair Trading has warned.

Failure to do so means a tenant can request the return of funds at any particular moment.

“It’s not a bond until it has been finalised online – sometimes bonds haven’t been finalised for 30 to 60 days,” Ms Carter said.

“We find that a lot of people just don’t do it at the time, but it should be done as soon as the tenancy commences.”

Final inspections

As soon as a tenant hands back the keys, the lease agreement ends, and a claim can be made on the bond. Online users are prompted to communicate with the other party.

Around 97 percent of bonds are paid without dispute from either party. Just three percent are disputed and go before NCAT. Around one percent of these claims are withdrawn before their scheduled hearing.

NSW Fair Trading has been monitoring how bond funds have been distributed and found they have remained stable, even during the COVID-19 pandemic.

In March, 60 per cent of tenants received their bond back in full; another 25 per cent received partial payment; while 15 per cent of bonds were paid direct to the agent.

“Only 15 percent of tenants did not receive their bond back, perhaps they were behind in their rent or didn’t want to do a final clean or fix any damages themselves and they asked for it to be taken out of their bond or decided to take no action on the claim their agent or landlord made for the bond,” Ms Carter said.

Agents wanting to learn about rental bonds online should call 1800 9900 724 or utilise on-line help available at:

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