The study comes from the Centre for Policy Studies, a think tank, which claims the average renter loses over £300 per tenancy due to lost interest and inflation because of what it calls “forced participation” in deposit protection schemes.

“Forcing tenants to pay large up-front deposits mean many people struggle to move between properties. They also lose out on accruing interest on their money which instead is retained by their landlord or letting agency, and often face a real struggle to receive their money back” says the CPS. 

Instead the think tank calls on the government to adopt insurance-based alternatives “which could easily be developed within the existing insurance market, would enable renters to retain more of their own money when moving into a property, enjoy the interest accruing during their tenancy, and avoid borrowing from friends, family, or pay-day lenders to gather enough funds for a deposit.”