The North Dakota Senate Industry and Business Committee convened on March 11, 2025, to discuss proposed regulations for Earned Wage Access (EWA) services. The meeting highlighted concerns regarding the potential for consumers to take out multiple advances without adequate tracking, which could lead to financial overextension.

John Barnes, a representative from a regulatory support company, emphasized the need for a statewide database to monitor EWA transactions. He noted that without real-time tracking, consumers could receive multiple advances, potentially leading to repeat borrowing. Reports from California's Department of Financial Protection and Innovation and the Center for Responsible Lending indicated that some consumers take out as many as 36 to 100 advances per year, raising alarms about the risks associated with unregulated lending practices.

The proposed database would allow EWA providers to verify whether a consumer has already taken out an advance, thereby preventing them from exceeding a set threshold, such as $1,000. This system aims to protect consumers from over-borrowing while ensuring that EWA remains a responsible financial tool. Barnes explained that the database would be funded by consumers using the service, with no cost to the state.

Senator Klein raised questions about the practical implementation of the database, asking how it would function in real-time for consumers seeking immediate access to funds. Barnes clarified that the system would involve an application interface that checks a consumer's borrowing status before approving additional advances.

The committee's discussions underscored the importance of establishing regulatory measures to safeguard consumers while allowing EWA providers to operate effectively. As North Dakota evaluates these regulations, the proposed database could serve as a critical tool in promoting responsible lending practices and preventing financial pitfalls for consumers. Further testimony and discussions are expected as the committee continues to explore this issue.