CT SB01396

Establishes a regulatory framework for "earned wage access" products in Connecticut, defining them as small loans under $750 that advance workers' already-earned but unpaid wages, effective October 1, 2025

Caps finance charges for earned wage advances at $4 per advance or $30 per month, and requires providers to offer at least one no-cost option per transaction with clear disclosure of how to elect the free option

Requires providers to verify borrowers' earned wages through payroll data before issuing advances, schedule repayment for the next payday (within 34 days), and reimburse borrowers for any overdraft fees caused by provider error

Prohibits providers from using credit reports to determine eligibility, charging late fees or penalties for nonpayment, reporting nonpayment to credit agencies, or pursuing collection through lawsuits, third-party collectors, or debt sales

Mandates that voluntary finance charges cannot be set as defaults, cannot be solicited before disclosing the approved advance amount, and borrowers must be clearly informed the charge is optional and can be zero dollars