Massachusetts 2023-2024 Regular Session

Massachusetts Senate Bill S692 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1 of 1
2	2	SENATE DOCKET, NO. 1750 FILED ON: 1/19/2023
3	3	SENATE . . . . . . . . . . . . . . No. 692
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Susan L. Moran
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act protecting consumers engaging with buy now pay later lenders.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :Susan L. MoranPlymouth and Barnstable 1 of 3
16	16	SENATE DOCKET, NO. 1750 FILED ON: 1/19/2023
17	17	SENATE . . . . . . . . . . . . . . No. 692
18	18	By Ms. Moran, a petition (accompanied by bill, Senate, No. 692) of Susan L. Moran for
19	19	legislation to protect consumers engaging with buy now pay later lenders. Financial Services.
20	20	The Commonwealth of Massachusetts
21	21	_______________
22	22	In the One Hundred and Ninety-Third General Court
23	23	(2023-2024)
24	24	_______________
25	25	An Act protecting consumers engaging with buy now pay later lenders.
26	26	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
27	27	of the same, as follows:
28	28	1 SECTION 1. Notwithstanding any general or special law to the contrary, a person or
29	29	2entity shall be considered a small loan business and third party loan servicer in the
30	30	3commonwealth, and shall be subject to sections 96 to 114 of chapter 140, section 24(a) of
31	31	4chapter 93, 209 CMR 18.00, and 209 CMR 20.00 if:
32	32	5 (a) The person or entity offers payment plans to any person or entity located in
33	33	6Massachusetts that:
34	34	7 (1) Provide an alternative payment method for online merchandise purchases;
35	35	8 (2) Provide the initial funding for the purchase to the online merchandise provider;
36	36	9 (3) Allow the purchaser to pay scheduled installments to the person or entity as a third
37	37	10party; and 2 of 3
38	38	11 (4) May charge interest on the scheduled installments or fees for any late payments made
39	39	12on any installments.
40	40	13 SECTION 2. Notwithstanding any general or special law to the contrary, pursuant to the
41	41	14authority granted in section 110 of chapter 140 of the General Laws, the commissioner of banks,
42	42	15or any subdivision of the division of banks that the commissioner directs, shall investigate the
43	43	16following companies to determine if said companies or any of their subdivisions or subsidiaries
44	44	17have operated or are currently operating as small loan businesses or third party loan servicers in
45	45	18the commonwealth:
46	46	19 (a) Afterpay Limited;
47	47	20 (b) Klarna Bank AB;
48	48	21 (c) Zip Co Limited;
49	49	22 (d) PayPal Holdings, Inc;
50	50	23 (e) Sezzle Inc; and
51	51	24 (d) Any other companies as determined by the division of banks to perform the same
52	52	25primary business function as the companies named in sections (a) through (e).
53	53	26 If the division of banks determines that any of the aforementioned companies has
54	54	27operated as a small loan business or third party loan servicer in Massachusetts, the commissioner
55	55	28of banks shall take any and all actions necessary to bring said companies into compliance with
56	56	29state law and shall require that said companies apply for a small loan business license within 6
57	57	30months of the division of banks’ determination. 3 of 3
58	58	31 SECTION 3. Notwithstanding any general or special law to the contrary, pursuant to the
59	59	32authority granted in section 97 of chapter 140 of the General Laws, the commissioner of banks
60	60	33shall promulgate regulations to ensure that any person or entity engaging in behavior as defined
61	61	34in section 1 of this act shall be required to hold a small loan business license to continue such
62	62	35business operations in the commonwealth.
63	63	36 SECTION 4. Chapter 140 of the General Laws is hereby amended by inserting, after
64	64	37section 94A, the following section:-
65	65	38 Section 94B. Disclosure of rates and fees
66	66	39 Any small loan business or third party loan servicer offering services to persons located
67	67	40in the commonwealth shall disclose, to the person or entity to whom the loan is being offered,
68	68	41upon the point of sale, the following:
69	69	42 (a) The full and final amount to be paid for the loan, including interest, if all payments
70	70	43are made on time and according to the loan contract;
71	71	44 (b) The maximum monetary penalty amount that could possibly be incurred from late
72	72	45payments on any of the payments detailed in the loan contract;
73	73	46 (c) The aggregate amount owed if any combination of the payments are late; and
74	74	47 (d) Whether the loan servicer will disclose any late payments to any credit reporting
75	75	48companies or any other entities, and the accompanying risk to credit score and subsequent
76	76	49consequences;
77	77	50 SECTION 4. This act shall take effect upon its passage.