The mode of Rent collection often changes depending on the geography an operator is present in. While a number of geographies prefer electronic transfers, bank transfers, Cards, etc., Dubai and many other parts of the world collect rent through Post Dated Cheques (PDCs) as it is the norm and the accepted practice.
This trend emerged in Dubai as collecting rent through PDCs helped operators hedge against bounced cheques from tenants. Bounced cheques were a criminal offence in the United Arab Emirates (unlike most countries where it is a civil offence), and hence, was a good way for landlords and property managers to ensure tenants paid their dues as per schedule.
However, managing Post Dated Cheques is not as easy as it sounds and hence, we have built a robust set of features in TheHouseMonk, TheOfficeMonk & TheMallMonk to help operators and tenants alike with Post dated cheques.
Why do we have this feature?
There are a lot of challenges associated with managing PDCs, but we identify 4 reasons as the root cause for us to build this feature within our product:
- Keeping track of the cheques received is an arduous task: The number of cheques that an operator might receive through a year is voluminous and operators find it hard to keep track of them. To quote an example, an operator who has 100 tenants will probably have 400-1,200 in their possession! This means they might need to keep track of move-in dates of each tenant, check when each cheque is due and cash it on time.
- Operators can forget to cash cheques on time causing a bad customer experience: A PDC has be cashed in on time and cannot be deposited late, operators can forget to pay a visit to the bank on the cheque’s due date which can lead to legal complications for the Operator, landlord and the tenant which in turn can lead to poor customer experience.
- Criminal charges on Tenants who do not have enough balance in their account: A deficit in funds in the account of the tenant could escalate to criminal charges on the tenants. Tenants need to constantly keep checking the bank account to ensure it is on the positive side which leaves a difficult and poor taste of rentals for tenants.
- Non-allocated increase in costs for the operator: An operator acts as the liaison between tenants and landlords, a failed/missed payment can cause the initiation of detailed processes causing operational overheads that neither the tenant nor the landlord will be willing to bear. This increases the expenses for the operator.
Using our system ensures that;
- There is very clear schedule based on PDCs received in advance
- Operators will be sent reminders about encashing cheques on a timely basis
- Tenants will be sent reminders about having sufficient balance
How can an operator manage cheques using our system?
Operators can follow these steps to ensure enable this feature on our system:
- Login to Godview
- Navigate to Core and click on My data
- Click on Units and Select the contract to which the PDC applies
- Select the payment plan
- Scroll down to the scheduled payments tab and enter all details as required
- Click on submit
All of the information is entered here is then displayed on the Scheduled payments tab, follow the steps below to locate this tab:
- Navigate to Core and click on Accounts
- Navigate to the Scheduled Payments tab
- All of the PDC information is stored here.
A couple of pointers to keep in mind:
- The contract has to be set at the yearly contract level for PDC’s to function on our system
- Operators can add the medium through which information needs to be sent to the tenant
Currently, reminders to tenants can go through Email, SMS, Whatsapp, our Circles App or all of the above.
While this system is not prominent in the world of real estate’s rent collection methods, there are countries that still have the system due to its blend in the culture. While things may be changing slowly, it is important to account for the minority of people who still use it and cater to their needs. If you happen to be a real estate professional who uses PDCs as a method of rent collection, you know the Property management software (PMS) that caters to your needs.