CreditLadder, Bud, and RentalStep have each won a share of a £2m prize fund, as part of the government’s rent recognition challenge. The Dragons’ Den style challenge tasked entrepreneurs to create a simple way for renters to record and share their rent payment data, to help them improve their credit score. The three winners will use their funding to further develop their businesses.

John Glen, economic secretary to the Treasury said: ‘Monthly rent is often the biggest expense that people face. Yet most lenders are unable to take it into account when working up a credit score.

‘Three pioneering start-ups have found a solution, and we’re giving them the investment and support they need to help millions of renters across the country achieve their dream of owning a home.’

Currently, a history of meeting rent payments is not routinely recognised in credit scores, and is not commonly considered when banks conduct mortgage affordability assessments - creating a barrier to getting onto the housing ladder.

Bud is building an AI driven rental recognition tool. It will allow banks to integrate it into their apps so that people can use their rental history to help them do things like apply for a mortgage.

CreditLadder allows tenants to report their rent payments. Landlords and letting agents can also introduce their tenants to the platform.

RentalStep is a landlord-tenant matching platform, which allows landlords to purchase a tenancy management service through the platform, and rental payments to be tracked and reported.

Launched in December 2017, the rent recognition challenge provided an initial round of grant funding to six budding businesses to help turn their ideas into a workable product. An expert panel of judges then whittled the six down to the three who have now received a final package of government funding.

Report by Pat Sweet