HB 2043

relating to the regulation of earned wage access services;
providing an administrative penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Sections 14.251(a) and (b), Finance Code, are
(a)  The commissioner may assess an administrative penalty
against a person who knowingly and wilfully violates or causes a
violation of this chapter, Chapter 394, Chapter 398, or Subtitle B,
Title 4, or a rule adopted under this chapter, Chapter 394, or
(b)  The commissioner may order the following businesses or
other persons to pay restitution to an identifiable person:
(1)  a person who violates or causes a violation of this
chapter, Chapter 394, or Subtitle B, Title 4, or a rule adopted
under this chapter, Chapter 394, or Subtitle B, Title 4;
(2)  a credit access business who violates or causes a
violation of Chapter 393 or a rule adopted under Chapter 393;
(3)  an earned wage access services provider who
violates or causes a violation of Chapter 398; or
(4) [(3)]  a person who violates or causes a violation
of Subchapter B, Chapter 1956, Occupations Code, or a rule adopted
SECTION 2.  Title 5, Finance Code, is amended by adding
Chapter 398 to read as follows:
CHAPTER 398. EARNED WAGE ACCESS SERVICES
Sec. 398.001.  SHORT TITLE.  This chapter shall be known and
may be cited as the "Texas Earned Wage Access Services Act."
Sec. 398.002.  DEFINITIONS.  In this chapter:
(1)  "Consumer" means an individual who resides in this
(2)  "Consumer-directed wage access services" means
offering or providing services directly to a consumer based on the
consumer's earned but unpaid income.
(3)  "Earned but unpaid income" means salary, wages,
(A)  a consumer represents, and a provider
reasonably determines, has been earned or has accrued to the
benefit of the consumer in exchange for the consumer's provision of
services to an employer or on the employer's behalf; and
(B)  has not, at the time of the payment of
proceeds, been paid to the consumer by the employer.
(4)  "Earned wage access services" means the business
(A)  consumer-directed wage access services;
(B)  employer-integrated wage access services; or
(C)  both consumer-directed wage access services
and employer-integrated wage access services.
(5)  "Earned wage access services provider" or
"provider" means a person who is in the business of offering and
providing earned wage access services to consumers.  The term does
(A)  a service provider, including a payroll
service provider, whose role includes verification of the earned
but unpaid income but who is not contractually obligated to fund
proceeds delivered to a consumer as part of an earned wage access
(B)  an employer that offers a portion of salary,
wages, or compensation directly to its employees or independent
contractors before the scheduled pay date.
(6)  "Employer" means a person who employs a consumer
or a person who is contractually obligated to pay a consumer earned
but unpaid income on an hourly, project-based, piecework, or other
basis, in exchange for the consumer's provision of services to the
employer or on the employer's behalf, including to a consumer who is
acting as an independent contractor with respect to the employer.
The term does not include a customer of the employer or a person
whose obligation to pay salary, wages, compensation, or other
income to a consumer is not based on the consumer's provision of
services for or on behalf of that person.
(7)  "Employer-integrated wage access services" means
delivering to consumers access to earned but unpaid income that is
based on employment, income, or attendance data obtained directly
or indirectly from an employer.
(8)  "Fee" includes an amount charged by a provider for
expedited delivery or other delivery of proceeds to a consumer and
for a subscription or membership fee charged by a provider for a
bona fide group of services that includes earned wage access
services or an amount paid by an employer to a provider on a
consumer's behalf that entitles the consumer to receive proceeds at
reduced or no cost to the consumer.  The term does not include a
voluntary tip, gratuity, or donation paid to the provider.
(9)  "Outstanding proceeds" means proceeds remitted to
a consumer by a provider that have not been repaid to that provider.
(10)  "Proceeds" means a payment to a consumer by a
provider that is based on earned but unpaid income.
Sec. 398.003.  DETERMINATION OF CONSUMER'S RESIDENCE.  A
provider may use the mailing address or state of residence provided
by a consumer to determine the consumer's state of residence for
Sec. 398.004.  APPLICABILITY OF OTHER LAW.  A provider is not
considered to be engaging in lending, money transmission, or debt
collection in this state, or in violation of the laws of this state
governing deductions from wages or the purchase, sale, or
assignment of or an order for earned but unpaid income, if that
provider complies with the requirements of Sections 398.005 and
Sec. 398.005.  REQUIREMENTS.  (a)  Before entering into an
agreement with a consumer for the provision of earned wage access
services, an earned wage access services provider shall provide the
consumer with a disclosure that:
(1)  may be in written or electronic form;
(2)  may be included as part of the contract to provide
(3)  uses a font and language intended to be easily
(4)  informs the consumer of the consumer's rights
(5)  fully and clearly discloses each fee associated
with the earned wage access services.
(b)  An earned wage access services provider must notify a
consumer of any material change to the information provided in a
disclosure statement under Subsection (a) to that consumer, using a
font and language intended to be easily understood by a layperson,
before implementing the particular change with respect to that
(c)  At the time that a provider charges a fee or solicits a
tip, gratuity, or donation from a consumer, the provider is
required to offer the consumer at least one reasonable option to
obtain proceeds at no cost to the consumer and clearly explain how
(d)  Each contract for the provision of earned wage access
services to a consumer by a provider may be in writing or electronic
(2)  include the written or digital signature of the
(3)  use a font and language intended to be easily
(e)  Each contract must disclose that:
(1)  fee obligations are subject to the limitations on
compelling or attempting to compel repayment under Section
(2)  proceeds will be provided to the consumer using a
method agreed to by the consumer and the provider;
(3)  the consumer may cancel at any time the consumer's
participation in the provider's earned wage access services without
(4)  the provider is required to develop and implement
policies and procedures to respond to questions asked and concerns
raised by consumers and to address complaints from consumers in an
(5)  if a provider seeks repayment of outstanding
proceeds, a fee, or another payment from a consumer, including a
voluntary tip, gratuity, or other donation, from a consumer's
account at a depository institution, including through an
electronic funds transfer, the provider must:
(A)  comply with applicable provisions of and
regulations adopted under the federal Electronic Fund Transfer Act
(15 U.S.C. Section 1693 et seq.); and
(B)  unless the payment sought by the provider was
incurred by the consumer using fraudulent or unlawful means,
reimburse the consumer for the full amount of any overdraft or
non-sufficient funds fees imposed on the consumer by the consumer's
depository institution if the provider attempts to seek any payment
from the consumer on a date before, or in a different amount from,
the date or amount disclosed to the consumer for that payment;
(6)  the provider is required to comply with all local,
state, and federal privacy and information security laws; and
(7)  if the provider solicits, charges, or receives a
tip, gratuity, or donation from the consumer, the provider:
(A)  must clearly and conspicuously disclose to
the consumer immediately before each transaction that the tip,
gratuity, or donation is voluntary and may be set to zero by the
(B)  must clearly and conspicuously disclose in
the contract and other service contracts with consumers that any
tip, gratuity, or donation from a consumer to a provider is
voluntary and the offering of earned wage access services,
including the amount of proceeds a consumer is eligible to request
and the frequency with which proceeds are provided to a consumer, is
not contingent on whether a consumer pays any tip, gratuity, or
donation or on the size of any tip, gratuity, or donation;
(C)  may not mislead or deceive the consumer
regarding the voluntary nature of the tip, gratuity, or donation;
(D)  may not represent that the tip, gratuity, or
donation will benefit a specific individual.
(f)  An earned wage access services provider shall make
available to the consumer a copy of the completed contract, when
receipt of the document is acknowledged by the consumer.
Sec. 398.006.  PROHIBITIONS.  (a)  An earned wage access
services provider may not, in connection with providing earned wage
(1)  share with an employer any fees, tips, gratuities,
or other donations that were received from or charged to a consumer
for earned wage access services;
(2)  accept payment of outstanding proceeds, a fee, or
a tip, gratuity, or other donation from a consumer through use of a
(3)  charge a late fee, deferral fee, interest, or
other fee or charge for failure to pay outstanding proceeds, a fee,
or a tip, gratuity, or other donation;
(4)  report any information regarding the provider's
inability to receive repayment of outstanding proceeds, or receive
a fee or a tip, gratuity, or other donation, from a consumer to a
consumer credit reporting agency or a debt collector;
(5)  require a consumer's credit report or credit score
to determine the consumer's eligibility for earned wage access
(6)  compel or attempt to compel payment by a consumer
of outstanding proceeds, a fee, or a tip, gratuity, or other
(A)  repeatedly attempting to debit a consumer's
depository institution account in violation of applicable payment
(B)  making outbound telephone calls to the
(C)  filing a suit against the consumer;
(D)  using a third party to pursue collection of
the payment from the consumer on the provider's behalf; or
(E)  selling the outstanding amount to a
third-party collector or debt buyer for purposes of collection from
(7)  make or use a false or misleading representation
or statement to a consumer during the offer or provision of earned
(8)  directly or indirectly engage in a fraudulent or
deceptive act, practice, or course of business relating to the
offer or provision of earned wage access services.
(b)  An earned wage access services provider is not precluded
from using any of the methods described by Subsection (a)(6) to:
(1)  compel or attempt to compel repayment of
outstanding amounts incurred by a consumer through fraudulent or
(2)  pursue an employer for breach of the employer's
contractual obligations to the provider.
SECTION 3.  Sections 398.005 and 398.006, Finance Code, as
added by this Act, apply only to a contract for earned wage access
services entered into on or after the effective date of this Act.
SECTION 4.  This Act takes effect September 1, 2025.