HB 5140 Summary: Earned Wage Access

• Excludes wages paid directly by employers to employees prior to regular paydays from the definition of "small loans" under Connecticut lending regulations, effective immediately upon passage.

• Adds payroll service providers to the list of entities exempt from licensing requirements when they verify employee earnings for employer-integrated advances without providing funds or controlling the licensed lender's activities.

• Authorizes licensed lenders to offer "employer-integrated advances" (advances up to 50% of earned wages for a pay period) with expedited transfer fees capped at $4 per advance and $16 per 30-day period, with repayment solely through payroll deduction.

• Prohibits additional charges, late fees, or other costs on employer-integrated advances if not repaid by the scheduled pay date, creating a distinct regulatory category outside standard small loan restrictions.

• Maintains existing consumer protections for traditional small loans, including APR caps (36% for loans under $5,000; 25% for loans $5,000-$50,000), restrictions on fees, prepayment penalties, and class action waivers.