On July 8, the governor of Connecticut signed into law SB 1396 to amend the licensing statute for small loan companies and to add a regulatory framework for providers of “earned but unpaid wage or salary income advance.” Under the law, Connecticut will require providers to be licensed as small loan companies and are authorized to make advances of earned wages of up to $750 and impose a finance charge of up to $4 per advance or $30 per month. The bill also sets disclosure, repayment and consumer protection requirements, including a mandate to offer at least one no-cost advance option per transaction and prohibitions on certain collection practices. The act will go into effect on October 1.
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