What changed between these versions
A substantive expansion of consumer protections and provider obligations. v2 introduces new requirements for no-cost earned wage access transfers, consumer and provider attestations, and restrictions on default tip amounts. It also subtly broadens the scope of federal preemption over state laws concerning earned wage access services.
Overview
There are several substantive changes, primarily in Section 2(a), alongside minor technical updates and renumbering. The bill's core purpose remains consistent, but new operational requirements and consumer safeguards have been introduced. · v2 expands consumer protections and imposes additional operational requirements on earned wage access providers. It also clarifies certain aspects of tip disclosures and broadens the federal preemption language for state laws that might classify these services as credit.
v2 introduces a mandatory one-business-day transfer period for no-cost earned wage access options and explicitly states that choosing this option cannot impact service eligibility or amount. New provisions require consumers to attest they haven't sought the same wages from other providers and mandate providers to verify and attest that disbursed amounts do not exceed earned wages. Additionally, v2 prohibits default tip amounts greater than $0 and tightens restrictions on how providers can describe the beneficiaries of tips. The language around federal preemption of state laws has also been broadened from "prohibits or substantially restricts" to "prevent or significantly interfere with" the offering of compliant services.
Major additions
This new subparagraph mandates that if a consumer chooses the no-cost option for earned wages, the earned wage access provider must initiate the transfer of those wages within one business day of the consumer's election.
This addition provides a concrete timeline for no-cost disbursements, ensuring consumers receive their earned wages promptly without incurring fees. It prevents providers from delaying no-cost transfers compared to fee-based ones, which could otherwise disincentivize the no-cost option.
This new subparagraph clarifies that a consumer's choice of the no-cost option for earned wages may not affect the amount of wages disbursed, the frequency of disbursements, or the consumer's eligibility to use the provider's services.
This provision strengthens consumer protection by explicitly preventing providers from penalizing consumers who opt for the no-cost service. It ensures equitable access to earned wages regardless of whether a fee or tip is paid, reinforcing the 'no-cost' principle.
This new clause permits an earned wage access provider to describe, in general terms, the benefits or services offered by the provider to consumers, even when discussing tips.
This provides a specific allowance for providers to communicate their value proposition to consumers without violating the restrictions on how tips can be described. It offers a limited scope for marketing or informational messaging within the context of tip solicitations.
This new section requires an earned wage access provider to obtain an attestation from a consumer, prior to the first disbursement of earned wages during each pay period, that the consumer has not requested the same earned wages from another provider during that pay period.
This addition aims to prevent 'wage stacking' or 'double-dipping,' where a consumer might access the same earned wages from multiple providers. It introduces a mechanism to ensure the integrity of the earned wage access system and mitigate potential risks for providers and consumers.
This new section prohibits earned wage access providers from setting a default tip amount greater than $0. It also specifies that if a consumer selects a $0 tip, the provider cannot require additional confirmation steps for that tip selection as a condition of completing the transaction.
This provision significantly enhances consumer protection by preventing deceptive practices related to tipping. It ensures that tips are truly voluntary and that consumers are not subtly coerced into paying them, making the no-cost option genuinely accessible without friction.
This new section requires an earned wage access provider, before each requested disbursement, to verify and attest to the consumer that the amount to be disbursed, combined with any prior disbursements in that pay period, does not exceed the consumer's actually earned and available wages for that period.
This addition introduces a critical safeguard against over-disbursement, protecting both consumers from potentially owing more than they earned and providers from associated risks. It mandates a real-time verification process for each transaction, ensuring accuracy and responsible lending practices.
Modifications
Earned wage access providers are now explicitly required to process no-cost transfers quickly (within one business day) and are prohibited from negatively impacting consumers who choose the no-cost option. This benefits consumers by ensuring timely and equitable access to earned wages without fees.
Before
v1 stated that if a provider offers a fee-based option, they must also offer a no-cost option for the same amount of earned wages.
After
v2 retains the core requirement but structures it into subparagraph (A) and adds new subparagraphs (B) and (C). Subparagraph (B) mandates a one-business-day transfer for no-cost options, and subparagraph (C) clarifies that the no-cost election cannot impact the amount, frequency, or eligibility for services.
This change provides clearer boundaries for tip solicitations, preventing providers from implying that tips directly benefit specific individuals or groups (other than the provider itself), even if such a statement might be factually true. This reduces potential for misleading consumers about tip allocation, while still allowing general marketing.
Before
v1 stated that a provider may not state that a tip will benefit any specific individual or group of individuals other than the provider itself, 'unless the statement is true.'
After
v2 modifies this by removing the 'unless the statement is true' clause and explicitly stating that a provider 'may not state that such tip will benefit-- (I) any specific individual; or (II) any group of individuals other than the provider itself.' It then adds a new clause (iii) allowing general descriptions of benefits.
This modification potentially expands the preemptive effect of the federal Act, making it more difficult for states to regulate or impose restrictions on compliant earned wage access services. State laws that might not 'prohibit or substantially restrict' but could 'prevent or significantly interfere with' such services would now be preempted, potentially limiting state-level consumer protections or regulatory frameworks.
Before
v1 stated that no State may impose laws that 'prohibits or substantially restricts' the offering or provision of earned wage access services that comply with the Act.
After
v2 changes this to 'prevent or significantly interfere with' the offering or provision of earned wage access services that comply with the Act.
Scope
Meaningful expansion or narrowing — The changes are primarily concentrated within Section 2, which outlines the core regulations for earned wage access services. While most changes are within subsection (a), a key modification also affects subsection (b) on state preemption. — v2 represents a refinement and strengthening of the policy direction established in v1, which aims to regulate earned wage access services while preventing them from being classified as credit. The changes enhance consumer protections and operational clarity, while also subtly broadening federal preemption. — The additions and modifications primarily build upon and clarify existing provisions within Section 2, such as the no-cost option and tip disclosures. The new attestation requirements introduce novel operational aspects that interact with the overall framework of responsible service provision. The preemption change has broader implications for state regulatory authority.
Impact analysis
Consumers utilizing earned wage access services
Primarily beneficial, providing stronger protections and clearer expectations, though with a new procedural requirement for attestation.
Consumers opting for the no-cost earned wage access option will now receive their funds within one business day and are explicitly protected from any negative impact on service eligibility, amount, or frequency due to their choice. They are also protected from default tip amounts greater than $0 and from additional confirmation steps for $0 tips. They will also be required to attest they haven't double-dipped.
Earned wage access providers
Increased regulatory burden and operational constraints, but also clearer guidelines for compliance, particularly regarding tips and no-cost options.
Providers face new operational requirements, including a one-business-day transfer mandate for no-cost options, explicit prohibitions on penalizing no-cost users, a ban on default tips greater than $0, and new attestation requirements for both consumers and providers. They also have clarified rules for tip disclosures.
State regulatory bodies
Reduced regulatory autonomy and increased federal oversight.
The scope of federal preemption has been broadened, potentially limiting the ability of states to impose certain regulations on earned wage access services that comply with the federal Act.