S08225 would add a new section to the New York Banking Law prohibiting certain financial institutions and ATM operators from charging fees for electronic benefit transfer (EBT) services tied to the use of an EBT card. The bill defines EBT services broadly to include deposits, withdrawals, disbursements, reconciliation, reporting, and electronic cash management for benefit programs. It also defines EBT cards to include cards or devices used to access public assistance and benefit funds, such as Medicaid-related cards, food assistance cards, public assistance cards, unemployment insurance cards, child support cards, adoption subsidy payment cards, and occupational training program cards.
Under the bill, banking organizations, out-of-state state banks with New York branches, and foreign banking corporations licensed in New York could not impose fees for EBT services attributable to the use of an EBT card. Operators or owners of ATMs would also be barred from imposing fees or surcharges for those services, except for interchange fees. The bill expressly excludes national banks, federal savings banks, federal savings and loan associations, federal credit unions, and other federally chartered or licensed entities from its coverage.
The bill would affect New York state banking and consumer protection law by creating a new prohibition on fee collection in connection with public benefit access. It would apply immediately to contracts entered into on or after the effective date between the state or its agencies and entities subject to New York banking, business, or financial services law, even if existing contract terms say otherwise. In practical terms, it would limit costs for recipients of public assistance and other government benefits who use EBT cards to access their funds.
Because there are no committee transcripts or recorded votes provided, the overall sentiment cannot be measured from debate or roll call history. Based on the bill text and caption, the measure appears consumer-protective and aimed at preventing fees from reducing benefit amounts. No specific opposition is documented in the provided materials, but the main policy tension is between protecting benefit recipients from fees and preserving fee revenue for banks, ATM operators, and payment networks, especially since interchange fees remain permitted.
The bill would amend the Banking Law by adding section 9-aa, establishing a new state-law prohibition on fees for EBT-related services charged by covered banking organizations and ATM operators. It would also override contrary terms in future state and agency contracts for EBT services, while leaving federally chartered institutions outside the bill’s scope. The affected parties are New York benefit recipients, state agencies administering public assistance programs, banks, foreign banking corporations licensed in New York, and ATM operators.
No committee discussion or vote record is provided, so there is no documented legislative sentiment from hearings or floor action. On its face, the bill reflects a favorable policy toward recipients of public benefits by seeking to eliminate fees that could erode assistance payments. The measure appears aligned with consumer and anti-fee protections, with no recorded opposition in the supplied materials.
The principal policy issue is whether banks and ATM operators should be allowed to charge any fees in connection with EBT access, versus the state’s interest in ensuring that public assistance and other benefit funds are delivered without reduction. The bill permits interchange fees but bars other fees and surcharges, which may be a point of concern for financial institutions and payment networks. Another notable limitation is the exclusion of national banks and other federally chartered entities, which could create uneven coverage and raise questions about the bill’s practical reach.