The Deposit Protection Service (DPS)
The DPS is the only scheme to offer both a custodial and insured tenancy deposit scheme. Both landlords and letting agents may use this scheme.
Landlord members of the Guild get discounted rates to the insured scheme making it the cheapest insured scheme out of all options on this page (at the time of writing, April 2013.)
The DPS Custodial Scheme is free of charge to use and the landlord / tenant can receive interest (which is linked to Bank of England base rate). The deposit must be transferred to the DPS who will hold the deposit for the duration of the tenancy.
The DPS insured scheme allows the landlord to hold onto the deposit in his / her own bank account but a premium is payable (discounted for Guild members). There is no joining fee nor annual membership fees with this scheme.
Tenancy Deposit Scheme (Dispute Service)
One of the insured schemes, which is available to landlords or letting agents.
The letting agents option allows agents to retain deposits on a per office / tenancy basis. Landlords have the option to go directly and there is no joining fee or annual fee.
Another insured scheme that works on a pay as you go option, which like the DPS and Dispute Service above allows you to retain the deposit in your account for the tenancy and a premium is payable . There is a joining fee with this scheme (slightly strange when none of the others require such a fee).
Comment on insured schemes
With all insurance schemes, if there is a dispute over the deposit, the landlord (or agent) must transfer the money to the insurance company who will then hold the deposit until the matter is resolved by either dispute resolution or the courts.