Senator Brouk Introduces STOP Act

NEW YORK STATE LAWMAKERS INTRODUCE STOP ACT TO CRACK DOWN ON PAYDAY LOAN APPS

Bill would regulate "Earned Wage Access" companies exploiting low-wage workers

Albany, NY – State Senator Samra Brouk, who represents much of Rochester, and Assemblymember Steven Raga have introduced the Stop Taking Our Pay (STOP) Act (S8939, A9644), legislation aimed at regulating so-called "Earned Wage Access" (EWA) companies that advocates say are pushing illegal, high-interest payday loans on New York workers through mobile apps.

The bill would classify EWA cash advances as loans under New York law and require fees and "tips" to be counted as interest, subjecting these products to the state's usury cap of 25% APR.

Why This Matters:

EWA companies, backed by Silicon Valley venture capital and Wall Street investors, market "no interest" cash advances but generate profits through fees and repeat borrowing. According to the New York State Attorney General, one common product carries an effective interest rate exceeding 750% APR.

The industry has extracted over $500 million from New Yorkers' paychecks since 2019. Studies show 75% of users reborrow immediately after repayment, and bank overdrafts increase 56% on average after using these products.

A new poll by the Community Service Society of New York found that 88% of New Yorkers support regulating payday loan apps under state usury laws.

Our Role:

Genesee Co-op is supporting this effort and was quoted in the following stories emphasizing our commitment to responsible lending and protecting communities from predatory practices, which are part of our efforts for a just and responsible financial system. Both are behind paywalls.

Rochester lawmakers target earned wage access payday lending - Rochester Business Journal

New York State introduces bill deeming EWA a loan -American Banker