Relating to consumer protections for earned wage access products.
SB 3000 would regulate earned wage access products, also described in the bill as earned wage advances. It defines an earned wage advance as a cash advance based on wages or other income a consumer has already accrued but has not yet been paid, where repayment is made through payroll deduction, account debit, wage assignment, or another automated method, and where the provider charges fees or receives other compensation. The bill also amends the Finance Code definition of “loan” to expressly include earned wage advances, bringing these products within the state’s consumer credit framework.
The bill creates a new subchapter in Chapter 342 of the Finance Code establishing consumer protections for these products. Before making an advance, providers must assess the consumer’s ability to repay the advance and other known obligations. If a provider causes an overdraft by attempting to collect before wages are deposited, it must reimburse the consumer for overdraft fees within 48 hours after notice. The bill also limits charges to no more than 10 percent of advances made in a 30-day period or $10 total in that period, prohibits more than one advance per day to the same consumer, bars late fees and interest, and forbids reporting nonpayment to credit bureaus or using lawsuits, third-party collectors, or debt buyers to collect these amounts. The Finance Commission is authorized to adopt rules and may require data submissions from providers.
The bill’s impact on state law is to place earned wage access providers under Texas consumer lending regulation and to treat these products more like loans for legal purposes. It would create new duties for providers, new consumer remedies for overdraft-related fees, and new limits on pricing, collections, and reporting. The bill would also give the Finance Commission oversight authority through rulemaking and data collection, with an effective date of September 1, 2025.
Overall sentiment appears neutral to supportive of consumer protection, based on the bill’s framing and lack of recorded opposition or vote history in the provided materials. The bill is presented as a consumer-protection measure rather than a prohibition on earned wage access products, suggesting an effort to allow the products to continue operating under tighter rules. No committee transcript or vote record is provided, so there is no direct evidence of debate, but the main policy tension is likely between consumer advocates favoring stronger safeguards and industry interests concerned about fee caps, repayment restrictions, and the classification of these products as loans.
SB 3000 would amend the Texas Finance Code to classify earned wage advances as loans and create a new regulatory subchapter governing earned wage access providers. It would impose ability-to-repay requirements, fee caps, overdraft reimbursement obligations, collection restrictions, and limits on credit reporting, while authorizing the Finance Commission to adopt rules and collect data. These changes would directly affect providers of earned wage access services and expand state oversight of short-term wage-based cash advances.
The available record suggests a generally consumer-protection-oriented and likely favorable posture toward the bill, with no recorded votes or committee testimony showing opposition or support in detail. The bill’s structure indicates an attempt to regulate rather than ban earned wage access products, which may appeal to lawmakers seeking a middle ground. Because no transcripts or votes are provided, the level of consensus or controversy cannot be measured precisely.
The main points of contention are likely to be the bill’s treatment of earned wage access as a loan, the strict fee cap of 10 percent or $10 per 30-day period, the prohibition on late fees, interest, lawsuits, third-party collections, and credit reporting, and the requirement to reimburse overdraft fees quickly. Consumer advocates would likely support these protections, while providers and industry groups may argue that the rules are too restrictive, could reduce product availability, and may not reflect the operational model of earned wage access services.