From The CTO: Building A Deposit-Free Product, Open Banking & Integrations

The property management industry is solving some of its biggest challenges today by adopting new technologies. That’s where Obligo comes in.

Obligo is solving for the complex outdated rental process, starting with eliminating security deposits in order to make renting as easy as checking in and out of a hotel. 

Yiftah Barouch, Obligo’s Chief Technology Officer, recently spoke with FinLedger about the company mission, building a unique fintech product, the importance of integrations, and more. Below is a condensed version of the full interview, edited for clarity and ease of reading.

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Why did Obligo choose to start with the security deposit element?

Using Open Banking and AI-based qualification, Obligo creates a way for renters to move in without paying a cash deposit upfront. The reason is simple: security deposits are not only a financial barrier for renters, but also an administrative burden for property owners and managers. At the time, not a lot of companies tried to solve the problem with deposits, so we went for it.

What are the biggest challenges in building the product?

In our conversations with prospects, questions like “Do you integrate with (property management software)?” come up early and often. Getting all the integrations in place was a challenge when we started, but now we are fully integrated with most of the top property management software like Yardi, MRI, Entrata, and more.

We are now building an “app store” within the Obligo platform, so it’s easy for us to create new integrations. It also made it easy for property managers to activate and customize based on their specific workflows. We’re seeing a lot of customization because everybody has their own process, which adds another layer of challenge on top of integrations.

We have property management companies with a few hundred units, and we also have landlords with 10,000+ units in the field. Anytime we work on an integration, we make sure that companies can activate it regardless of their size. 

How do you qualify renters for deposit-free living? 

We qualify renters for deposit-free living with open banking. We ask them to connect a payment method, then pre-authorize that payment method and check their liquidity. 

We built a model with machine learning, and let the computer algorithm decide what we should look at. We don’t look at renters’ finances from five years ago. Instead, we’ll look into their account balances, income and expenses in the last 6-12 months. A renter’s balance, and the balance history over time, are definitely the most crucial factors for us to evaluate. 

We always think about how best to communicate open banking to renters, but we’re actually surprised that even early on people were accepting of it. Obligo started in 2018, and we still see the same numbers around how many renters qualify by connecting their bank account. It’s around 70-80% consistently. 

Last year you raised a $35 million Series B. How have you been using that to further Obligo’s goals?

One of the most important aspects of our business is our core technology. It’s something that we’ve been investing in since day one. So growing Obligo’s R&D team, which is based in Tel Aviv, has been a very big focus for us. In today’s market, hiring is a challenge. Making sure that we scale our R&D and Sales teams are two areas we’re investing in.

Are there any next steps, or products you’ve been working on moving forward?

We’re always thinking about integrations and what we want to do in that space. We have an open API that can empower property management companies to build their own user experience. We allow them to embed the Obligo deposit-free experience into their own product, so renters can enjoy a seamless journey when they go through the leasing flow. 

We really believe that to make a change, you need to create a great user experience. More and more property management companies are using our API when they build their leasing flows. That’s the vision for us.

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