The Financial Technology Association (FTA) has submitted a letter to Connecticut Governor Ned Lamont urging a veto of Senate Bill 1396, which would significantly restrict access to earned wage access (EWA) services across the state.
EWA services allow workers to access their already-earned wages between traditional paychecks, helping to manage cash flow, avoid late fees, and meet emergency expenses. In the letter, FTA emphasizes that SB 1396, while well-intentioned, would curtail this critical financial tool for Connecticut workers and impose unprecedented requirements on EWA providers.
FTA raised several key concerns with the legislation:
- The bill creates an unfair statutory advantage for a small segment of the EWA industry, discriminating against providers based on employers’ payroll systems.
- A newly imposed fee cap would apply uniquely to EWA products, unlike any other financial service in the state.
- The bill mandates intrusive data monitoring requirements, compelling providers to track usage patterns and limit consumer access to multiple EWA products, raising privacy and competition concerns.
FTA remains committed to supporting a robust regulatory framework for EWA that ensures strong consumer protections, promotes innovation, and expands financial inclusion. We stand ready to collaborate with lawmakers to achieve balanced, pro-consumer policy solutions.
Read the full letter here.