On March 20, the Governor of Arkansas enacted HB 1517 (the “Act”), which establishes the state’s Earned Wage Access (EWA) Services Act. The legislation regulates the business of providing consumers access to their “earned but unpaid income.” Under the new law, a defined “provider” includes a person who offers EWA services to a consumer but does not include an employer that offers a portion of salary or wages early.
EWA providers would not be deemed to be not engaging in lending, money transmission, or debt collection activities in Arkansas if they comply with those requirements including: developing and implementing policies and procedures to respond to questions raised by consumers; addressing consumer complaints in an expedient manner; offering consumers at least one reasonable option to obtain proceeds at no cost to the consumer; disclosing to a consumer their rights under an agreement with the EWA provider and all fees; informing consumers of any material changes to the terms and conditions of the EWA services before implementing them; permitting consumers to cancel use of the EWA provider’s services at any time without a fee; complying with all applicable privacy and information security laws; and providing proceeds to consumers by any means mutually agreed upon by the consumer and EWA provider.
The Act prohibits providers from sharing with an employer a portion of any fees, voluntary tips, gratuities, or other donations that were received from or charged to a consumer for EWA services. The Act also bars providers from requiring a consumer’s credit report or credit score to determine eligibility for services. It also forbids accepting payment from a consumer by means of a credit or charge card, charging late fees, using a lawsuit or third parties to collect outstanding amounts, misleading consumers about the voluntary nature of tips or donations, or false advertising about EWA services.
