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H 4277

Coach Joshua Staley - Ridge View High School

2025-2026 Regular Session Introduced by Terry Alexander and 122 co-sponsors

Caps on check-cashing fees: fees for government, payroll, personal, and other checks are limited, plus a $5 initial setup fee, with annual posting and higher penalties.

Introduced and adopted
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WeVote Research Nonpartisan
Bill Summary · H 4277

Summary: Massachusetts H. 4277 — An Act creating a maximum allowable check-cashing rate for check cashers

Overview

H. 4277 seeks to cap the fees charged by licensees that cash checks, drafts, or money orders. The bill introduces specific rate-based limits for different categories of checks, a cap on initial account setup fees, mandatory annual fee schedules, and an updated penalty provision. It would take effect 12 months after enactment.

Status and Legislative Path
- Status: Read second and ordered to a third reading; moving through the House for final consideration.
- Introduced: July 23, 2025
- Committee action: Reported favorably by the Committee on Consumer Protection and Professional Licensure
- Related actions: Shortly after introduction, a new draft circulated (H. 400) and the committee recommended passage

Purpose and intent

  • To limit the costs that consumers face when cashing checks, drafts, or money orders and to improve price transparency in the check-cashing industry.
  • To ensure consistency in fee structures across different types of checks and payment instruments.

Key provisions

Section 6 — Maximum fees for cashing checks

No licensee may charge fees or other considerations in excess of these caps:
1. Government checks (issued by the United States or the Commonwealth) less than $1,500: 2.5% of the check face value + $1.00 service charge.
2. Payroll checks: 2.25% of the face value + $1.00 service charge.
3. Personal checks: 5% of the face value or $5.00, whichever is greater, + $1.00 service charge.
4. All other payment instruments (including checks, drafts, or money orders) under $1,500: 3% of the face value + $1.00 service charge.

Section 6(b) — Initial account setup fee

No licensee may charge more than $5.00 to set up an initial customer account.

Section 6(c) — Fee schedules and posting

  • Licensees must file an annual schedule of fees with the commissioner (by a date set by the commissioner).
  • The fee schedule, including any revisions, must be conspicuously posted at every place of business and mobile unit.
  • Amendments to the fee schedule or changes in hours of operation must be filed with the commissioner promptly.

Section 13 (amendment to penalties)

  • The maximum civil penalty under Section 13 is increased from $500 to $1,000 for violations.

Section 1 (effective date)

  • The act takes effect 12 months after the effective date of enactment.

Who is affected

  • Licensed check cashers, money order issuers, and other entities operating under Massachusetts Chapter 169A.
  • Consumers who rely on check-cashing services, particularly those cashing government, payroll, personal, or other payment instruments.

Implementation timeline

  • Enactment would begin a 12-month period before the new rules take effect.
  • Annual filing and posting requirements begin upon effective operation of the law.

Potential impact and considerations

  • Consumer protection: Lower and standardized fees could reduce costs for individuals who rely on check-cashing services.
  • Industry impact: Licensees may need to adjust pricing structures, update fee schedules, and enhance posting compliance.
  • Compliance costs: Annual filing and conspicuous posting requirements; potential penalty increase for violations.
  • Access considerations: The caps could influence the availability of affordable check-cashing alternatives in certain communities.

If you’d like, I can break down the specific fee scenarios with example transactions or compare these caps to current Massachusetts practice.

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

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