SSB 5328
In CommitteeSenate
Earned wage access services
Concerning the regulation of earned wage access services.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill establishes a new state licensing and regulatory regime for businesses that provide earned wage access services—offering workers early access to wages they’ve already earned but not yet been paid. It sets licensing requirements, fee limits, consumer protections, and enforcement tools for the Department of Financial Institutions.
- Creates a new licensing and regulatory framework for businesses offering earned wage access services, administered by the Department of Financial Institutions (DFI).
- Requires providers to obtain a state license before offering services in Washington, starting July 1, 2026, with background checks, surety bonds (minimum $30,000), and financial responsibility requirements.
- Limits fees for delivery or expedited delivery to $7.00 per transaction, bans late fees, interest, or penalties on unpaid amounts, and prohibits credit card or charge card payments for repayment.
- Mandates clear, upfront disclosures to consumers—including no-cost options, fee details, and voluntary nature of tips—and prohibits deceptive advertising or misleading consumers about tips or donations.
- Prohibits providers from sharing fees with employers, requiring credit checks, reporting unpaid balances to credit bureaus, or using certain aggressive collection tactics (e.g., unsolicited calls, lawsuits, or third-party collectors) for standard repayments.
Who is affected
- Earned wage access service providers — Businesses that want to offer earned wage access services in Washington must now get a state license, follow new rules about fees and disclosures, and meet background and financial responsibility requirements.
- Workers (consumers) using earned wage access services — Workers who use these services will see clearer disclosures about fees, more transparency about voluntary tips, and protections against certain collection tactics and credit reporting.
- Employers partnering with wage access providers — Must ensure their contracts with wage access providers comply with new state rules and avoid sharing fees with providers or violating wage laws.
- Washington State Department of Financial Institutions (DFI) — Will be responsible for licensing, examining, and enforcing rules for providers, including collecting fees and assessments to cover regulatory costs.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
Mandating no-cost options and clear, upfront fee disclosures empowers low-wage workers to make informed choices and avoid hidden costs, directly benefiting financially vulnerable consumers who are most likely to use these services.
FinancialPeopleRef: Sec. 9(2) & (3)(a)-(c)Requiring clear disclosure that tips/donations are voluntary and non-contingent prevents deceptive practices that disproportionately pressure low-income users—especially those already living paycheck to paycheck—into paying extra out of perceived obligation.
FinancialPeopleRef: Sec. 9(7)(a)-(b) & Sec. 10(8)(a)-(c)Banning late fees, interest, and aggressive collection methods (e.g., lawsuits, third-party collectors) for standard repayments protects workers from predatory debt traps and reduces exposure to legal harassment, especially for those with limited financial resilience.
Public SafetyPeopleRef: Sec. 10(5) & (7)(a)(i)-(iv)Requiring providers to reimburse consumers for overdraft fees caused by erroneous or premature repayment attempts directly mitigates a major cost burden for low-balance bank accounts—often held by low-income workers—and internalizes externalized banking costs onto providers.
FinancialPeopleRef: Sec. 9(9)(b)Prohibiting credit checks and credit card payments for repayment prevents credit score damage and avoids pushing vulnerable users into high-interest revolving debt, protecting consumers who may lack established credit or healthy banking relationships.
FinancialPeopleRef: Sec. 10(2) & (3)
Potential Concerns (5)
The $7.00 per-transaction fee cap may reduce provider profitability, especially for micro-businesses or sole proprietors operating thin margins, potentially discouraging new entrants or causing consolidation into larger firms with economies of scale.
Business & EmploymentLean industryRef: Sec. 10(4)The $30,000 surety bond requirement creates a significant upfront and ongoing financial barrier for small operators and sole proprietors, effectively excluding lower-wealth individuals and favoring larger, better-capitalized firms—despite the bill’s consumer-protection framing.
Business & EmploymentIndustryRef: Sec. 4(4) (surety bond requirement of $30,000)Prohibiting aggressive collection tactics (e.g., lawsuits, third-party collectors, unsolicited calls) for standard repayments reduces harassment risk, but the carve-out for “fraudulent or other unlawful means” creates ambiguity and may allow providers to escalate collection for disputed or minor debts, potentially increasing consumer stress or legal exposure.
Public SafetyIndustryRef: Sec. 10(6) & (7)(a)(i)-(iv)By explicitly excluding fees from being classified as interest or finance charges, the bill avoids triggering Washington’s usury cap (RCW 19.52.020) and federal Truth in Lending Act requirements, reducing regulatory scrutiny but potentially obscuring the true cost of the service and weakening consumer price transparency.
FinancialIndustryRef: Sec. 18(2) (fees not considered interest or finance charges)Exempting providers from money transmitter licensing (which typically requires bonding, compliance, and reporting under RCW 19.230) significantly reduces regulatory costs for providers, disproportionately benefiting large, well-resourced firms that can absorb compliance and scale nationally, while small operators may still face de facto barriers.
Business & EmploymentIndustryRef: Sec. 18(1)(c) (providers not considered money transmitters)
Who Is Most Affected
Low- and moderate-income workers who rely on earned wage access to manage cash flow gaps—especially hourly, gig, and part-time workers—are the primary beneficiaries. The bill’s fee caps, disclosure rules, and collection restrictions directly reduce financial risk and exploitation for this group.
Large, well-capitalized EWA providers (e.g., Paystreak, FlexWage, Earnin) benefit from regulatory clarity and exemption from money transmitter licensing, enabling national scale and reduced compliance friction. The $30K bond requirement and licensing infrastructure favor firms with access to capital and legal teams.
Small EWA startups and sole proprietor operators face higher barriers to entry due to the $30,000 surety bond, annual assessments, and reporting requirements. While the bill aims to protect consumers, its structure favors incumbents with deeper pockets.
Employers who partner with EWA providers must ensure contracts comply with the fee-sharing prohibition (Sec. 10(1)) and avoid co-signing or subsidizing fees—potentially increasing administrative burden but reducing liability risk.
The DFI gains expanded regulatory authority and cost-recovery mechanisms (fees, assessments, fines), strengthening its oversight capacity. However, this also increases its operational responsibilities and potential political scrutiny.