RELATING TO FINANCIAL INSTITUTIONS -- COMMUNITY OBLIGATIONS AND, BANKING OFFENSES
Summary
S2517 would require every automated teller machine in Rhode Island to provide a free, real-time display or inquiry of the consumer’s available account balance before a cash withdrawal is completed. The balance information must be shown clearly on the screen before the user is prompted to enter a withdrawal amount, and the consumer must be allowed to cancel the transaction without charge.
The bill also prohibits banks, credit unions, and ATM operators from charging any fee when no cash is dispensed, when the required balance disclosure or balance inquiry is used, or when a transaction is declined. The requirement applies broadly to ATMs operated by financial institutions and non-bank operators alike, and enforcement would be handled by the Department of Business Regulation as an unfair practice subject to administrative penalties and corrective orders. The act would take effect on January 1, 2027.
Impact
The bill would amend Rhode Island General Laws chapter 19-9, adding a new section governing ATM balance disclosure and related fees. It would create a statewide consumer-protection rule for cash withdrawals, impose operational requirements on ATM interfaces, and authorize the Department of Business Regulation to enforce compliance through administrative action, fines, and corrective orders. Financial institutions, ATM operators, and consumers using cash withdrawal machines in Rhode Island would be directly affected.
Sentiment
The available legislative history suggests generally favorable treatment, with the Senate Committee on Commerce voting 6-0 to hold the bill for further study rather than rejecting it. No committee transcript is available, so there is no recorded debate to indicate strong opposition or support beyond the committee’s willingness to continue considering the proposal. The bill’s consumer-protection focus and broad applicability suggest it is intended to address transparency and fee concerns at ATMs.
Contention
The main points of potential contention are likely to be the operational and compliance burdens placed on banks, credit unions, and non-bank ATM operators, especially the requirement to display a real-time balance before withdrawal and to provide a no-charge cancellation option. Another possible issue is the prohibition on fees for balance inquiries or declined transactions, which could affect existing fee structures. Supporters would likely emphasize consumer transparency and avoiding overdraft-related harm, while opponents may focus on implementation costs, technical feasibility, and revenue impacts.
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