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HD 1046

An Act creating a maximum allowable check- cashing rate

194th Legislature (2025-2026) Introduced by Dan Hunt

Massachusetts bill capping check-cashing fees to reduce costs for unbanked populations, though implementation details and business impact remain contested.

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WeVote Research Nonpartisan
Bill Summary · HD 1046

Legislative bill overview

HD 1046 would establish a legal cap on the fees that check-cashing businesses can charge customers for their services in Massachusetts. The bill sets a maximum allowable rate, preventing what legislators view as predatory pricing in an industry that primarily serves unbanked and underbanked populations.

Why is this important

Check-cashing fees disproportionately affect low-income individuals who lack access to traditional banking services, effectively creating a "poverty tax" on those least able to afford it. Capping these fees could save vulnerable populations significant money while potentially improving financial inclusion and reducing barriers to economic participation.

Potential points of contention

  • Business viability concerns: Check-cashing operators argue that fee caps may force some businesses to close, reducing access points for underserved communities who rely on these services in areas with limited banking infrastructure
  • Alternative financial services: The cap might inadvertently push consumers toward riskier alternatives like payday lenders or informal lending arrangements, which could be less regulated and potentially more exploitative
  • Rate-setting specifics: The bill's effectiveness depends heavily on what maximum rate is established—too low could be impractical, too high may provide insufficient consumer protection

Compiled from official sources — confirm details with the bill’s official record.

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