In a landmark decision, the NSW Supreme Court has ruled that the ‘innovative’ financial products developed by ZeroBonds would contravene sections 23 and/or 32 of the Residential Tenancies Act 2010 (NSW) (‘The Act’) regarding fees payable by tenants to enter or continue residential tenancy agreements.  

ZeroBonds business model consisted in offering for tenants to pay a non-refundable fee to the company, based on the amount of bond coverage sought by the tenant. In exchange, ZeroBonds offered to (a) ‘refund’ or ‘advance’ the bond to the tenant and (b) ‘take on the risk’ by promising to the landlord that they would pay up to 6 weeks of rent should the landlord wish to make claims against the tenant’s bond. After receiving information from NSW Fair Trading that its products might contravene tenancy law, ZeroBonds was seeking a declaration from the Supreme Court that they did not. 

The Court decision confirms that s 23 and s 32 of the Act are meant to protect tenants from paying non-refundable fees to enter into residential tenancy agreements, and that ZeroBonds services would have consisted of such fees.  

Housing is at the foundation of our communities. And when unscrupulous companies try to make a quick buck, everybody loses in the long run. Beyond this specific decision – available online in full as ZeroBonds Residential Pty Ltd v Commissioner for Fair Trading [2025] NSWSC 265 – Shelter NSW welcomes the broader move towards better regulatory protections for people who rent their home.  

We commend NSW Fair Trading regulatory oversight, and its commitment to ensure tenants are not taken advantage of. In a media release, NSW Rental Commissioner Trina Jones said: “Rental bond processes should be fair, transparent and lawful so we welcome this decision which is a win for tenants who won’t be burdened with unnecessary and unlawful fees.” 

Shelter NSW continues to advocate for a well-regulated, fair rental system adequately balancing the rights and responsibilities of landlords and tenants. Specifically, we look forward to the development of the Portable Bond Scheme, which will provide minor but much welcome cost of living relief to people who rent their home by removing the too common need to have two bonds lodged with Fair Trading when moving homes.