Bill
HB 5566
HB 5566 would carve out earned wage access providers from being “regulated lenders” under Michigan’s Credit Reform Act, only if HB 5558 becomes law.
Proposed by: Representatives Alexander, Herzberg, Bierlein, Tate, Roth, Liberati, Bruck (with co-sponsors)
Committee: Regulatory Reform
Ties with: HB 5558
Purpose and main intent
- HB 5566 amends the Michigan Credit Reform Act (1995 PA 162, MCL 445.1852) to exempt earned wage access (EWA) services from the definition of “regulated regulatory lender.” This effectively creates a specific carve-out for EWA providers, aligning with the broader Earned Wage Access Services Act (HB 5558) that would regulate EWA businesses separately through a new licensing regime.
- The tie-bar indicates HB 5566 is contingent on enactment of HB 5558 (i.e., the EWA licensing framework must become law for HB 5566 to take effect).
Key provisions and changes (as drafted in HB 5566)
- Definitions (Sec. 2): The bill clarifies existing terms within the Credit Reform Act and creates a predicate to exempt EWA services from the category of “regulatory lender.” Specifically, it states: “Regulatory lender does not include a person that is licensed to provide earned wage access services under the earned wage access services act.”
- Exemption scope: Earned wage access service providers would not be treated as “regulatory lenders” under the Credit Reform Act, reducing overlapping regulatory treatment between traditional credit lenders and EWA providers.
- Enacting clause: The amendments are not self-executing; they require HB 5558 (the Earned Wage Access Services Act) to become law for HB 5566 to take effect.
Other relevant context (from the accompanying analysis)
- HB 5558, which would create a comprehensive licensing regime for EWA services, is the broader companion bill intended to regulate EWA providers in Michigan. It includes:
- Licensing requirements and fees
- Bonding requirements and regulatory oversight by the Department of Insurance and Financial Services (DIFS)
- Consumer protections (fee disclosures, cancellation rights, privacy, avoidance of coercive collection practices)
- Prohibitions on certain practices (e.g., sharing fees with employers, using credit scores for eligibility, penalties, or tying proceeds to tips)
- Reporting, recordkeeping, audits, and enforcement tools (cease and desist orders, suspensions, revocations)
- Penalties (administrative fines, misdemeanor penalties)
- HB 5559–5569 complement HB 5558 and various other acts to exclude EWA licensees or EWA services from specific statutes.
Who would be affected
- Earned wage access service providers operating in Michigan (or seeking to operate) would face a new licensing regime under HB 5558; HB 5566 would exempt these providers from being regulated as “regulatory lenders” under the Credit Reform Act, provided HB 5558 becomes law.
- Depository institutions and traditional lenders would retain existing regulatory treatment under the Credit Reform Act.
- Employers, consumers, payroll service providers, and consumer reporting agencies could experience indirect effects through the EWA regulatory framework (in HB 5558) and the adjusted regulatory landscape.
Procedural and timeline considerations
- HB 5566 is introduced and referred to the Committee on Regulatory Reform; it contains an enacting clause stating it does not take effect unless HB 5558 is enacted.
- If HB 5558 is enacted, HB 5566’s exemption would become operative, modifying the scope of the Credit Reform Act accordingly.
Fiscal and enforcement notes
- HB 5558 carries a fiscal impact on DIFS, driven by licensing and enforcement activities; HB 5566’s exemption would influence regulatory overlap but does not by itself create new fiscal costs, beyond the broader EWA licensing framework.
- Administrative penalties under the EWA framework would apply, with fines and fees deposited to an interest-bearing state treasury account to fund regulatory activities.
Bottom line
- HB 5566 aims to carve out earned wage access providers from the “regulatory lender” category in Michigan’s Credit Reform Act, but only if the companion EWA licensing bill (HB 5558) becomes law. This reflects an intent to create a separate, dedicated regulatory framework for EWA services while reducing duplication with traditional credit regulation.
Compiled from official sources — confirm details with the bill’s official record.
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