For over 80 years, property managers have been using pooled trust accounts to receive rent from tenants, take their management fee, and pay tradespeople their share for any maintenance work before finally disbursing the rent to landlords.
While this is a tried and tested method, the real estate industry has been plagued with trust account abuse, fraud, theft, and misappropriation by a select few rogue agents who choose to do the wrong thing. Moreover, relying on pooled trust accounts increases the chances of human error.
But there is an alternative to the traditional trust account – the automated rental payments platform, Managed.
Managed is an Australian proptech and fintech company that is redefining rent roll management and rental payments through a trustless digital wallet system. The platform replaces traditional real estate trust accounts with a payments-first, automated architecture that moves rent instantly and securely between tenants, landlords, tradies, and agencies while ensuring that agents comply with the law.
How does the digital wallet system work?
Managed automates rent collection, disbursement, and payment reconciliation using a wallet-based model. This wallet structure eliminates trust account dependency.
Each user (tenant, owner, agency, or tradie) has a dedicated digital wallet, not a single pooled trust account. Every tenant, owner, tradie and agency gets a Managed wallet – described as a digital bank account (think PayPal wallet, Uber Cash, etc.).
Rent is split and distributed in real time directly to each party’s wallet as soon as funds clear. The system provides instant owner payments, real-time visibility, and auditable transaction trails. Funds can be sent into and moved between wallets, and withdrawn to a bank account.
Critically, rental funds are never held or accessed by the agency in a pooled trust account; users have their own accounts, and rental funds don’t go into a trust account. That’s the structural difference that enables ringfencing.
There is high visibility as property managers can see wallet balances for all owners, tenants, tradies, and properties.
Managed is like internet banking for investment properties. At a high level, the model works like this:
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Each stakeholder has their own wallet (or designated account) in the platform: for the agency, landlord, tenant, and tradie.
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The tenant funds their wallet to pay rent by making a payment via electronic funds transfer (EFT), BPAY, credit card, or debit card.
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These funds automatically move into the property wallet within the Managed platform. The funds are then automatically split from the property wallet to the agency wallet (management fee), tradespersons’ wallets, and bills. Finally, the remaining funds move into the owner's wallet.
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From the wallets, the money is paid out to the bank accounts of the agency, tradesperson, and the owner. The owner can choose to receive their rent in their owner’s wallet weekly, monthly, or instantly. If they choose weekly or monthly payments, the funds will sit in the property wallet until it is time to pay into the owner’s wallet. The property wallet will automatically undertake disbursements of bills before transferring the funds into the owner’s wallet.
Step 1 – Tenant pays into their wallet
How tenants fund their wallets
Tenants have a tenant wallet and multiple payment options:
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Fast bank transfer or Osko
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Bank-state-branch (BSB) and account number
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BPAY
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Direct debit or credit card (depending on setup)
The default method is for you to manually top up your wallet using EFT. This means you add funds in, which can then be used to pay for rent and tenancy bills. If you choose this setting, the app will wait until you top up your wallet with enough funds prior to using them for upcoming payments. The tenant wallet balance shows funds that:
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have been paid in
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but not yet used to pay rent or tenancy bills.
Tenants can also withdraw surplus funds back to their bank account, with two-factor authentication required. The app will remind you if you have any outstanding rent or bills to pay. Once you click proceed, the amount will be transferred from your wallet to your bank account.
Where the money “sits” at this point
The money is in the tenant’s own Managed wallet, which is effectively a virtual account in the platform’s payments infrastructure (powered by Zai in Australia). Once the tenant pays their rent into their tenant wallet, the funds automatically move into the property wallet.
Step 2 – Rent becomes due: wallet-to-wallet transfers
Rent itself is handled as a distinct “rent” flow (different from ad hoc bills). Once a lease is active, rent invoices are created automatically; bills are created by the agency as needed.
When rent is due:
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Managed checks the tenant’s wallet balance.
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If there are sufficient funds (or an active direct debit), the system triggers a wallet-to-wallet payment.
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That payment doesn’t go into a trust account. Instead, Managed’s engine splits it immediately.
A tenant sends money to a wallet that they own. If they send too much money, they can log in, click refund and receive that money instantly back to their own bank account.
The Managed system splits the rent money from the tenant. It always sends the management fee to the agency first, and then the net rental funds to the owner.
In one logical operation, the rent payment is broken into:
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Agency management fee → Agency wallet
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Net rent/owner income → Owner/property wallet (with smart handling for upcoming bills)
No reconciliation against a separate trust bank account is needed; the ledger is the flow.
Step 3 – How the owner’s side works (smart wallet and disbursement)
There are two concepts relevant to the owner’s wallet:
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The owners’ property wallet is found on the transactions tab and shows any money being used for expenses or until the owner wants it disbursed.
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The owner's wallet is really only used when money can't be disbursed (maybe they have not added a bank account, or the account details are incorrect). If you see money just sitting there, not allocated for any expenses, something’s wrong and needs fixing.
By default, Managed is configured so that bills can be paid from rental income. This means the app will withhold just enough money from your rental income to pay any upcoming expenses, and you will receive the balance.
This is where the “smart wallet” logic kicks in:
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After the rent is split and the agency fee is taken, the net rent hits the owner’s side.
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The system checks: “Do you have bills upcoming?”
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If yes, it holds back enough in the property wallet to cover those expenses.
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If not, it instantly sends to that owner’s offset account.
Owners can also change:
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Which bank account receives rental income, and
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Payout frequency – e.g. instant (default), weekly, or monthly. If they choose weekly/monthly, income accumulates in their profile balance and is paid out on the chosen cycle.
Where the money sits now:
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In the owner’s property wallet, as reserved funds for upcoming bills, and/or
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En route or already transferred to the owner’s nominated bank account (their “offset”).
Step 4 – Paying tradespeople and other bills
When a tradesperson needs to be paid, the property manager creates a bill via the action centre.
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You specify:
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What it’s for (e.g. maintenance job, council rates)
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Who is paying (tenant or owner)
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Who is receiving (owner, tenant, tradie, another creditor, or any biller that accepts BPAY)
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Due date – which is also the auto-payment date if the payer has automatic payments enabled.
The payee can be the owner, the tenant, a tradie, another creditor (service provider) or any biller that accepts BPAY.
In practice for a trade invoice:
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The property manager attaches the invoice and schedules the bill.
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On the due date, Managed:
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Withholds the amount from the owner’s rental income (if default method) or charges the owner’s nominated card or bank account.
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Transfers the funds either:
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wallet-to-wallet into the tradie’s wallet (if they’re on Managed), where the tradie can then withdraw to their bank; or
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out to an external BPAY biller if it’s a council/strata bill.
Where the money sits for tradies:
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In the owner’s property wallet prior to payment (as reserved funds), then
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In the tradie’s wallet, or with the external biller if paid via BPAY.
For tradies, their wallet operates like any other user’s:
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They have a tradie wallet.
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They can see incoming payments and withdraw to their business bank account.
Step 5 – Agency ringfencing: how the agency gets paid
The agency itself also has a digital wallet.
When rent is processed:
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Managed’s engine always sends the management fee to the agency first and then the net rental funds.
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That fee amount lands in the agency's wallet, from where it can be withdrawn to the agency’s operating bank account.
What the agency does not get:
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It does not receive the full rent into a pooled trust account.
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It does not hold owner or tenant funds in a commingled bank balance.
Agents don’t handle any money, and so they don’t need to hold a trust account. There is no handling of money. It is direct from the tenant to the landlord. The agent receives only their fee.
That’s the ringfencing at work:
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Tenant funds are in the tenant’s wallet until used.
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Owner funds are in the owner’s property wallet or their bank.
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Tradie funds are in the tradie’s wallet or paid to their biller.
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Agency funds are only a portion of the fee in the agency’s wallet or operating account.
How each party is ringfenced in practice
All wallet funds are ring-fenced in custodian S3 (simple storage service) structures with bank-grade security. Ring-fencing is a legal and structural mechanism to separate assets and liabilities. This ensures security of the funds, eradicates the risk of trust account abuse (because the agency cannot access the funds), and helps agencies meet their regulatory requirements.
Putting it all together:
Tenants
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Have a tenant wallet that they control.
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Can top up, pay, and withdraw (subject to arrears or bills and two-factor authentication).
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Their funds are never pooled with other tenants in an agency trust account; instead, each payment is associated with their profile and property.
Owners
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Have a property wallet that holds funds earmarked for expenses or waiting for payout.
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Can choose how bills are funded (from rent versus their own payment method, like a credit card or bank account) and how often they’re paid out (instant, weekly, or monthly).
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If disbursement fails, money temporarily sits in an owner’s wallet until bank details are corrected, rather than in a general trust pool.
Tradies and suppliers
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Have their own tradie wallet (if onboarded), or are paid directly via BPAY.
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Payments are triggered from specific bills linked to a property and payer, so money is always traceable to a source.
Agency
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Has an agency wallet that receives only management fees and other agency charges.
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Does not receive or pool rent or bill funds under its control; those flows go directly between user wallets and external bank accounts.
Platform infrastructure
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All transactions are processed in Australia through Managed’s payments partner Zai, and the system operates on the New Payments Platform (NPP) or Osko rails for instant payments in and out of wallets.
Wallet balances and transactions are visible to property managers (for oversight), but ownership and movement are governed by platform rules, not by manual bank transfers.
A simple end-to-end example
To make it concrete, here’s a typical rent cycle under the Managed wallet model:
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Tenants top up their wallet via fast bank transfer and set up automatic rent payments.
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On the due date, Managed debits the tenant’s wallet for the rent amount.
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Immediately, the system:
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Sends the agency fee to the agency wallet.
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Sends the net rent into the owner’s property wallet.
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The smart wallet checks for upcoming bills:
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It withholds just enough from the rental income to pay those bills.
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It disburses the remaining balance instantly to the owner’s bank account (or accumulates it for a weekly/monthly payout, if chosen).
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When a trade invoice is due, the system pays the tradie from the reserved bill amount (owner’s wallet) into the tradie's wallet or via BPAY.
At no point is there a pooled trust account holding everyone’s money; each step is a controlled, logged wallet-to-wallet or wallet-to-bank transaction.
Managed was built to help next-generation agencies win market share fast. It is the only comprehensive property management platform that exclusively delivers secure, instant, and automated direct payments from tenant to landlord, eradicating the need for a trust account.
If you’d like to find out how Managed can help power your growth, call Conor on 0452 298 394 or book a discovery call today.