The proposed bill establishes the Washington State Employer-Integrated Wage Access Services Act, which introduces a licensing requirement for businesses providing earned wage access services, effective July 1, 2026. Under this legislation, no individual or entity may offer such services without a license from the Department of Financial Institutions. The bill defines key terms such as "consumer," "earned but unpaid income," and "provider," and outlines the application process, which includes background checks and maintaining a surety bond. It also mandates that any fees from unlicensed transactions must be refunded to consumers. Additionally, the bill limits fees charged to consumers for these services to a maximum of $5 per transaction and $10 per month, aiming to protect consumers from potential abuses in the wage access market.

Furthermore, the bill introduces amendments to existing laws regarding loan definitions, expanding the definition of "Loan" to include "consumer-directed wage access services." It clarifies exemptions from the chapter's requirements and updates language related to the processing of payments on seller-financed loans. The bill also establishes a framework for the director to manage a common database for tracking earned wage access transactions and grants the director authority to waive certain licensing provisions to promote commerce and consumer protection. Overall, the legislation seeks to enhance consumer protection and ensure transparency in the employer-integrated wage access services industry while formalizing these changes within the state's legal framework.

Statutes affected:
Substitute Bill: 31.04.015, 31.04.025