Bill
H 99
H.99 creates a Vermont licensing framework for earned wage access providers, ensures clear disclosures, a no-cost basic option, and stricter consumer protections.
Status
- Introduced: January 31, 2025
- Referred to: House Committee on Commerce and Economic Development
- Hearing scheduled: April 9, 2025 (A-1)
- Primary sponsor: Michael Marcotte; cosponsors: Edye Graning, David Bosch, Jonathan Cooper, Kirk White, Monique Priestley, Abbey Duke, Anthony Micklus, Herb Olson.
- Stakeholders who testified or were listed for committee: earned‑wage providers (EarnIn, DailyPay, Payactiv), Vermont Bankers' Association, AARP Vermont, Center for Responsible Lending, National Consumer Law Center, and state banking regulator.
Purpose and intent
H.99 would create a new statutory framework (8 V.S.A. chapter 75) to regulate “earned wage access” (EWA) services — businesses that advance workers’ earned but unpaid wages before regular paydays. The bill’s intent is to require licensing, enhance consumer protections, increase transparency about costs and terms, and establish operational and privacy‑related standards for EWA providers operating in Vermont.
Key definitions (selected)
- Earned wage access services: delivering funds to consumers prior to their scheduled payday, based on earned but unpaid income.
- Earned but unpaid income: wages or compensation owed but not yet paid, as reasonably determined by the provider.
- Provider: any person in the business of offering EWA services.
- Employer‑integrated provider: a provider that uses payroll/time data supplied by an employer or its vendor.
- Direct‑to‑consumer provider: a provider that determines advances based on consumer‑provided information.
- Precise geolocation data: technology‑derived location data accurate within a 1,850‑foot radius.
- Biometric data: technological measurements of unique biological/physiological traits (fingerprints, iris scans, gait, voiceprints, etc.).
Major provisions
- Licensing requirement: A person must hold a state license to provide EWA services in Vermont. Financial institutions that are federally insured may be exempt from needing a license but remain subject to the chapter’s requirements. Entities providing “substantial assistance” to unlicensed providers can be restricted from doing so if they knew (or should have known) the provider was unlicensed.
- License application contents: description of services, whether employer‑integrated or direct‑to‑consumer, list of other states where licensed, description of charges/fees, bankruptcy/receivership history, and other Commissioner‑required information (including use of the Nationwide Multistate Licensing System).
- Required basic service: Licensees must offer a basic option enabling receipt of proceeds at no cost to the consumer, consistent with minimum standards set by the Commissioner.
- Permitted fees/services:
- Employer‑integrated providers may charge an employer (obligor) to offer basic or additional services.
- Providers may charge for optional expedited delivery of proceeds and may offer subscription/membership fees for bundled services (subject to conditions in the bill).
- Optional gratuities: Providers may solicit voluntary gratuities if they give clear notice that gratuities are optional, allow a no‑gratuity choice, and require affirmative consumer consent after entering the amount.
- Disclosures: Before providing an advance, licensees must give written or electronic notice of terms and conditions (full disclosure provisions appear in the bill but are partially truncated in available text).
- Regulator authority: The Commissioner (authority to be specified by statute) may adopt rules and require further information; the bill contemplates use of existing licensing systems.
Who is affected
- Consumers/workers in Vermont who use earned wage access services (improved transparency and baseline free option).
- Earned‑wage access providers (startups and established firms such as EarnIn, DailyPay, Payactiv) — must comply with licensing, disclosure, and service requirements.
- Employers who contract with employer‑integrated providers — may be charged for offering EWA as an employee benefit.
- Financial institutions and third‑party vendors providing services to EWA providers — subject to restrictions concerning assistance to unlicensed providers and some compliance obligations.
Potential impacts and tradeoffs
- Consumer protections and transparency would increase (mandatory disclosures, a no‑cost basic option, controls on gratuities).
- Licensing and compliance impose regulatory and administrative costs on providers and potentially on employers if employer‑integrated fees are passed along.
- The bill draws industry and consumer‑advocate participation (witness list indicates active stakeholder engagement), suggesting negotiations about operational details (privacy, fee limits, enforcement) may continue in committee.
Notes
- The available draft in the legislative packet is partial/truncated in places (full disclosure, enforcement, penalty, and rulemaking text not fully shown). The bill establishes a framework; final regulatory details (fee caps, reporting requirements, enforcement remedies) may be filled in by the Commissioner’s rules or later amendments.
Compiled from official sources — confirm details with the bill’s official record.
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