| 1 | 1 | | By: Menéndez S.B. No. 1736 |
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| 2 | 2 | | |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | |
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| 6 | 6 | | A BILL TO BE ENTITLED |
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| 7 | 7 | | AN ACT |
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| 8 | 8 | | relating to a convenience fee for processing electronic payments |
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| 9 | 9 | | for motor vehicles. |
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| 10 | 10 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 11 | 11 | | SECTION 1. Subchapter E, Chapter 348, Finance Code, is |
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| 12 | 12 | | amended by adding Section 348.416 to read as follows: |
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| 13 | 13 | | Sec. 348.416. CONVENIENCE FEE FOR PROCESSING ELECTRONIC |
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| 14 | 14 | | PAYMENTS AUTHORIZED. (a) In this section, "electronic payment" |
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| 15 | 15 | | means a payment made by credit card, debit card, electronic funds |
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| 16 | 16 | | transfer, electronic check, or other electronic method. |
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| 17 | 17 | | (b) A holder of a retail installment contract or the |
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| 18 | 18 | | holder's agent may collect a fee for processing a retail buyer's |
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| 19 | 19 | | electronic payment under the contract only if: |
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| 20 | 20 | | (1) the fee is reasonably related to the expense |
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| 21 | 21 | | incurred by the holder or holder's agent in processing the |
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| 22 | 22 | | electronic payment; |
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| 23 | 23 | | (2) the fee does not exceed the lesser of $10 or five |
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| 24 | 24 | | percent of the amount of the payment; and |
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| 25 | 25 | | (3) the holder or holder's agent: |
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| 26 | 26 | | (A) allows the buyer to make a payment by a method |
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| 27 | 27 | | other than an electronic payment that does not incur a fee; |
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| 28 | 28 | | (B) does not establish electronic payment as the |
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| 29 | 29 | | expected form of payment; and |
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| 30 | 30 | | (C) informs the buyer of the following before the |
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| 31 | 31 | | buyer agrees to make an electronic payment: |
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| 32 | 32 | | (i) the amount of the fee to be charged |
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| 33 | 33 | | under this section; |
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| 34 | 34 | | (ii) that the buyer may make a payment by an |
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| 35 | 35 | | alternative method that does not incur a fee, including by check, |
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| 36 | 36 | | cash, or money order; and |
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| 37 | 37 | | (iii) that the holder or holder's agent may |
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| 38 | 38 | | not establish electronic payment as the expected form of payment. |
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| 39 | 39 | | SECTION 2. This section is effective September 1, 2025. |
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