Despite the fact that from the client's point of view, DepositFree is a simple placing the deposit on their behalf, the legal nature of the service sounds different.
De jure, it's a two-side surety agreement, and we are issuing the deposit as a surety from the name of Cardoo to the name of the rental agency.
Security deposit that is required by the rental agency is, for us, an indicative to define the size of our surety, it's sum.
Example 1
E.g. if the security deposit is $500, the surety is $500.
But there is always an option: for example, a hirer can place a $200 deposit, and the rental agency may require a $300 additional surety from Cardoo.
Example 2
If the rental agency wishes to extend the deposit/surety for a better protection, the client, for example, can place a $500 deposit, and $500 surety can be got from Cardoo, so in fact, the sum of your risk protection increases to $1000.
Example 3
The rental agency can drop the idea of the security deposit for a better marketing impression & require a $1000 surety from Cardoo.
There are 2 types of deposits:
1. Rental deposit - a deposit in the name of the rental agency before deposit-free comes.
2. Security deposit - a deposit that Cardoo issues in the name of the rental agency when there is a trust issue. This deposit is a guarantee for Cardoo's obligations to the surety agreement in favor of the rental agency. Security deposit protects the rental agency from the risk that we don't pay for the surety. It has nothing to do with the rental deposit.
To sum up, Deposit-Free technology can be applied in the regions where it is de-jure forbidden to place security deposits on behalf of another person, as, by legal nature, it's a surety.