HR7428-118

1. Short title This Act may be cited as the Earned Wage Access Consumer Protection Act.

2. Earned wage access services If an earned wage access provider offers a consumer the option to receive earned wages in exchange for a fee, such earned wage access provider shall also offer such consumer the option to obtain the same amount of earned wages at no cost to the consumer. Each earned wage access provider shall disclose the following before entering into an agreement with a consumer: Any limits on the amount of earned wages a customer may request from such provider, including— any limits on the amount of earned wages a consumer may request from the provider each day; any limits on the amount of earned wages a consumer may request from the provider each pay period; and any limits on the amount of earned wages a consumer may request from the provider that are based on a determination by the provider of the ratio between the amount of earned wages requested by the consumer and the total wages earned by the consumer, and how such determination is made. Any fees that such provider may apply, and the amount of such fees, including fees relating to expedited disbursement and subscriptions. A description of how the consumer may obtain earned wages without paying a fee. An overview of such provider’s use of voluntary payments that describes— whether such provider will accept voluntary payments from the consumer and in what amounts; and whether such provider will suggest the consumer provide voluntary payments and in what amounts. Each earned wage access provider shall disclose the following after approving any request from a consumer for access to earned wages but before disbursing such earned wages to such consumer: The account number such provider has assigned to the consumer, if applicable. The amount of earned wages that will be provided to the consumer by such provider. The total amount of any fees applied by such provider. A list of any voluntary payments the consumer has agreed to provide. The amount that such provider intends to collect as repayment after disbursing the earned wages, the date on which such provider intends to collect such amount or a description of when such provider intends to collect such amount, and the manner in which such provider intends to collect such amount. If an earned wage access provider solicits, charges, or receives a voluntary payment from a consumer, such provider— shall clearly and conspicuously disclose to the consumer, before the provider commences the transaction to which the voluntary payment is related, that such voluntary payment— is voluntary; is not a requirement for receiving earned wage access services; and will not impact the frequency with which such earned wages are disbursed to such consumer; and may not state that such voluntary payment will benefit any specific individual. Each earned wage access provider shall notify each consumer with which such earned wage access provider has entered an agreement to offer earned wage access services of any material changes to the terms and conditions of service used by such provider not less than 30 days before such material changes take effect. The Bureau shall, not less than 180 days after the date of the enactment of this section, issue rules that govern the form and manner in which the disclosures described in this section are provided to consumers. If an earned wage access provider makes earned wage access services available to a consumer on a recurring basis, such earned wage access provider— shall allow such consumer to discontinue such services if such consumer provides reasonable notice to such earned wage access provider that such consumer desires to discontinue such services; and may not impose any financial penalty on such consumer as a result of any discontinuation of services. Each earned wage access provider shall develop and implement policies and procedures to respond to questions and complaints from consumers relating to— unauthorized disbursement of earned wages; disbursement of earned wages in an incorrect amount; disbursed earned wages that were not received; repayment of disbursed earned wages that is not received or was made in an incorrect amount; and voluntary payments that were not authorized or were made in an incorrect amount. An earned wage access provider may not seek repayment of earned wages disbursed to a consumer by such provider by— filing a civil suit; initiating arbitration proceedings; using the services of a debt collector (as such term is defined in section 803 of the Fair Debt Collection Practices Act); or selling the rights to the repayment of the disbursed earned wages to a third-party debt buyer. Subparagraph (A) shall not apply if an earned wage access provider is— seeking repayment of earned wages disbursed to a consumer based on information provided by the consumer that the consumer knew was false; or pursuing the employer of the consumer to which such provider disbursed earned wages for breach of its contractual obligations to the provider. If an earned wage access provider seeks repayment of disbursed earned wages, payment of a fee, or a voluntary payment directly from a deposit account of a consumer, on an incorrect date or in an incorrect amount, and such attempt triggers an overdraft fee or non-sufficient funds fee from the financial institution of the consumer, the earned wage access provider shall reimburse such consumer for such fee. An earned wage access provider may not— share any fees, tips, gratuities, or other donations that were received from or charged to a consumer for earned wage access services with the employer of such consumer; accept payment of fees or voluntary payments from a consumer though a credit card of the consumer, unless such credit card is provided to the consumer as a part of the earned wage access service; or require a consumer to pay a late fee, deferral fee, interest, or any other penalty or charge as a result of a failure by the consumer to pay a fee, tip, gratuity, or other donation requested or applied by such provider. An earned wage access provider may disclose, to an employer with which such provider has a contract relating to earned wage access services, only such information about earned wage access services used by consumers who are employees of such employer as is necessary for such earned wage access provider to recover disbursed wages. It shall be unlawful for any earned wage access provider to discriminate against any consumer on the basis of race, color, religion, national origin, sex, pregnancy, marital status, or age when offering earned wage access services. The Bureau may issue such rules as the Bureau determines appropriate to carry out this section. In this section: The term Bureau means the Bureau of Consumer Financial Protection. The term consumer means a natural person. The term earned wages means salary, wages, compensation, or other income that a consumer or an employer has represented and that an earned wage access provider has reasonably determined have been earned or have accrued to the benefit of the consumer in exchange for the services provided by the consumer, but that have not yet been paid to the consumer by an employer. Services provided by the consumer to the employer include any services provided— on an hourly, project-based, piecework, or other basis; or when the consumer is acting as a contractor of the employer. The term earned wage access services means the delivery of earned wages to a consumer based on— employment, income, or attendance data provided by the employer of such consumer or a payroll service vendor contracted by the employer of such consumer; or representations made by the consumer and the reasonable determination of the earned proceeds of such consumer by an earned wage access provider. The term earned wage access provider means a person who provides earned wage access services to consumers. The term earned wage access provider does not include— a person who is not obligated to provide access to earned wages as part of an earned wage access service; an employer that offers a portion of salary, wages, or compensation earned by a consumer directly to such consumer prior to a normally scheduled pay date; a financial institution that permits a consumer to access amounts associated with an electronic fund transfer from the employer of the consumer for which the financial institution has received information but which has not yet settled; or a payroll service vendor that facilitates payments to a consumer of wages earned by such consumer. The term payroll service vendor means a vendor contracted by an employer to facilitate payment of employee wages in accordance with Federal, State, and local law, including the Fair Labor Standards Act of 1938. The term voluntary payment means any payment voluntarily made by a consumer to an earned wage access provider when accessing earned wage services, including a tip, gratuity, or donation. Voluntary payments and any fees paid by a consumer to an earned wage access provider may not be construed to be a finance charge as such term is defined in the Truth in Lending Act.

3. Conforming amendments Section 103 of the Truth in Lending Act (15 U.S.C. 1602) is amended— in subsection (f), by striking defer its payment and inserting defer its payment, but does not include earned wage access services as defined in the Earned Wage Access Consumer Protection Act; and in subsection (g), by adding at the end the following: The term creditor does not include earned wage access providers as such term is defined in the Earned Wage Access Consumer Protection Act..