Renters Kick It Old School
According to data compiled by JPMorgan Chase (JPM), 78% of rent checks are still paid using paper checks or money orders, out of more than 100 million Americans who pay a combined $500 billion in rent each year.
Most of the country’s 12 million property owners run smaller portfolios of fewer than 100 units. That’s a lot of checks being mailed, and just as much paperwork being handled. JPMorgan sees an opportunity in servicing this market, and is piloting a program that would automate the process.
So What’s the Story?
In recent years, JPMorgan has been developing a platform called Story, which aims to be an inclusive property management system.
The investment bank is a lender to owners of multifamily properties, lendingt out $95.2 billion to 33,000 clients in the sector over Q1 and Q2. But JPMorgan executives see rent collection as a “time-intensive” process that’s overdue for improvement.
At present, many property owners use Intuit’s (INTU) QuickBooks or Microsoft (MSFT) Excel to keep track of rent payments. Story is intended to provide owners a more comprehensive view of their entire portfolio.
Impact for Tenants
JPMorgan says the goal is to also improve the rental experience for tenants, allowing them to automate payments and view payment histories via an online dashboard. It’s part of the bank’s digital push in perhaps the final frontier for paper checks. Especially after the COVID-19 pandemic, nearly all of the world’s transactions are done online.
The data that’s collected could also prove beneficial for property owners. JPMorgan executives say property owners will gain access to analytics that could drive future investments, help screen potential tenants, and set rent levels.
As we’ve seen in the age of ecommerce, the business done online is just one part of the deal — the highly valuable data gathered is the other.
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