A rental deposit alternative replaces the lump-sum deposit with a smaller regular fee and a binding commitment to pay if the landlord has a valid claim at the end of the lease. The tenant keeps their cash. The landlord keeps protection against damage and unpaid rent. The tenant is still liable for what they owe.
Why deposit alternatives exist
A deposit is usually one or two months' rent, due on the same day as the first month's rent. On a R12,000 flat with a two-month deposit, that is R36,000 before you get the keys. Many tenants who can comfortably afford R12,000 a month cannot find R36,000 at once, especially when their previous deposit is still on its way back. The landlord, meanwhile, has to invest the deposit in an interest-bearing account and account for the interest.
South African law allows a landlord to ask for a deposit but does not require one, as our guide to the deposit rules explains. That leaves room for other kinds of security.
The common types
| Type | What the tenant pays | Refunded at the end? | Tenant still liable? |
|---|---|---|---|
| Monthly fee with a payment authorisation (how De-Posit works) | A monthly fee, a percentage of the deposit amount | No | Yes |
| Deposit paid in instalments | The deposit spread over a few months | Yes, less deductions | Yes |
| Deposit loan | Loan repayments plus interest and fees | The deposit yes, the interest no | Yes |
| Higher rent instead of a deposit | Extra rent every month | No | Yes |
The model matters less than two questions. How much will you pay over the whole lease? And what happens when the landlord claims?
How De-Posit works, step by step
- Get pre-approved. Answer questions about your income, consent to a credit check and see your outcome. Most decisions are instant. You do not need a property yet.
- Show your certificate. Download the De-Posit Pre-Approval Certificate and share it with the landlord or agent. They invite you to the property on De-Posit.
- Activate your cover. Accept your monthly fee and set up the debit-order authorisation up to the deposit amount. You move in without paying a deposit.
- Pay monthly. The fee is collected two business days after your salary day.
- Move out. If the landlord has a valid claim, they submit it with evidence. You have five business days to dispute or settle. De-Posit settles approved claims up to the cover amount and recovers the money from you.
What it costs
The De-Posit monthly fee is 1% to 2% of the deposit amount, with a minimum of R99. On a R15,000 deposit that is R150 to R300 a month. The rate depends on your credit and rental history and can come down over time. The application fee is normally R149 and is R0 for a limited time. The fees page lists the admin fees that apply only if something goes wrong, such as a failed debit order.
What it is not
- Not insurance. Nobody takes on your liability. If there is damage, you pay for it.
- Not a deposit in instalments. The monthly fee does not build up into a deposit, and you do not get it back.
- Not a way around a bad record. There is a credit and affordability check, like there would be for the lease itself.
When a cash deposit is the better deal
If you have the money sitting in savings, you will not need it during the lease, and you expect it back in full, a cash deposit usually costs you less. The landlord has to pay you interest at no less than a savings rate, and you lose little by parking it there. A deposit alternative earns its fee when the cash would otherwise come from a loan or a credit card, from your emergency buffer, or when raising it would delay your move. We work through the numbers in cash deposit or monthly fee.
Why landlords and agents accept it
- More applicants can afford to move in, so good tenants are not lost over upfront cash.
- There is no deposit to invest, track interest on and refund within the legal deadlines.
- Claims follow one documented process with evidence, and the tenant stays liable for the full amount.
Landlords and agents can read more on the landlords page.
This article is general information about renting in South Africa, not legal advice. For a specific dispute, contact your provincial Rental Housing Tribunal or an attorney.