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By Hannah Lang
Mon, December 22, 2025 astatine 9:53 AM CST 1 min read
By Hannah Lang
Dec 22 (Reuters) - A U.S. user concern bureau said connected Monday that fashionable "earned wage" advances connected idiosyncratic paychecks do not lucifer user loans, reversing people from guidance the regulator enactment retired past twelvemonth nether past President Joe Biden.
In an advisory opinion, the U.S. Consumer Financial Protection Bureau said astir paycheck advances were not taxable to the Truth successful Lending Act, meaning that companies that connection the products are not required to supply workers with definite disclosures, specified as the outgo and terms of credit.
The sentiment is not legally binding, but is intended to supply clarity for manufacture participants, the CFPB said.
A increasing fig of providers connection paycheck advances, including integer slope Chime, which allows customers to entree up to $500 of their wages interest-free earlier payday with nary mandatory fees.
Several states including Nevada and Wisconsin person specified in authorities instrumentality that specified products are not loans, but Congress has not passed a instrumentality clarifying the contented connected a national level.
Last year, the CFPB had released interpretive guidance that moved to acceptable national guardrails for the fast-growing market, stipulating that paycheck advances were equivalent to user loans and arguing that doing truthful would supply greater transparency for consumers.
Under President Donald Trump, the CFPB has moved to locomotion backmost respective of the agency's actions nether the erstwhile administration, advancing Trump's effort to curtail policies helium views arsenic a load connected businesses.
Last month, the bureau projected narrowing cardinal civil-rights-era anti-discrimination requirements for the fiscal industry, pursuing an enforcement bid from Trump earlier successful the twelvemonth to destruct the usage of disparate-impact liability.
(Reporting by Hannah Lang in New YorkEditing by Frances Kerry)
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