Minnesota House Bill HF2874

Minnesota 2025-2026 Regular Session

• Introduced: 3/26/25
• Refer: 3/26/25

Caption

Earned wage access services regulated.

Impact

The bill introduces a licensing requirement for all businesses offering earned wage access services, ensuring they adhere to established policies and consumer protection measures. It prohibits providers from imposing excessive fees, collecting certain types of information like credit scores, or engaging in potentially predatory practices such as charging late fees. Additionally, providers must offer at least one no-cost option for accessing funds to enhance consumer flexibility and choice.

Summary

HF2874 aims to regulate earned wage access services in Minnesota, establishing a framework under which providers must operate. The bill defines key terms related to earned wage access services, including 'consumer' and 'provider', and outlines the responsibilities and prohibitions for service providers. This legislation is designed to provide consumers with timely access to earned but unpaid wages, potentially alleviating financial stress that results from waiting for traditional pay periods.

Contention

One area of contention regarding HF2874 is the balance between ensuring consumer protection and facilitating access to earned wages. Advocates for the bill argue it is crucial to eliminate predatory lending practices that could arise in the realm of advance wage payments. However, some providers express concern that stringent regulations could overly limit their ability to operate flexibly, potentially leading to reduced access for consumers who need these services urgently. Additionally, defining the parameters for what constitutes 'earned but unpaid income' may provoke further legislative debate.