Northern Ireland is to have its first Tenancy Deposit Scheme, in a move to avoid disputes over deposits between tenants and landlords.
It will involve a third party holding onto the cash and mediating in disagreements, bringing NI into line with England and Wales.
The scheme, for private rentals, has been introduced by Social Development Minister Nelson McCausland.
But the Landlords Association said it would be too bureaucratic.
The assembly approved legislation for the independent third party scheme to protect tenant's deposits from 1 April.
Mr McCausland has appointed four administrators to operate the new scheme.
He said: "This scheme will provide assurances for tenants and protection for landlords, helping to minimise long drawn-out legal proceedings and disputes.
"Tenants across Northern Ireland in the private rental sector can now be afforded the same protection as those in Great Britain.
"This is a positive development for the private rental sector".
He said schemes such as this had been very successful in the rest of the UK adding that he was keen that the private rental sector was seen as a "good option for tenants".
"Return of tenant deposits is an issue I hear of time and time again and I'm pleased that Northern Ireland citizens can now be reassured their money is safe," he said.
"The new scheme... will encourage a more professional approach to tenancy deposit practice, minimise disputes and go some way to improving the sector's reputation as a desirable option."
However, Declan Boyle of the Landlords Association said he was not happy with the new plan.
"It's very onerous and the penalties here are going to be more severe than in the UK, for whatever reason," he said.
As part of the scheme, housing benefits will be paid directly to landlords.