On May 6, Indiana Governor Mike Braun signed House Enrolled Act No. 1125 into law, making Indiana the latest state to enact a statutory framework for regulating earned wage access (EWA) products. The Indiana Earned Wage Access Act, which takes effect January 1, 2026, requires most EWA providers to obtain a license from the Indiana Department of Financial Institutions and comply with operational, disclosure, and consumer protection requirements.
The Act distinguishes between "employer-integrated" and "consumer-directed" EWA models. Employer-integrated models rely on income, attendance, or other employment data supplied directly by the employer. Consumer-directed models, by contrast, are based on a provider's reasonable determination of a consumer's earnings using information reported by the consumer.
The Act also clarifies that services offered in accordance with the new framework are not considered loans or credit under Indiana law. Other key provisions include:
- Mandatory licensing and reporting requirements. EWA providers must obtain a license, submit quarterly reports, and retain records for at least two years.
- Fee restrictions and tip transparency. Providers must offer a no-cost option, and any tips must be clearly disclosed as voluntary and may not be shared with employers. Providers may not default users into fee-based or tip-based services.
- Prohibited debt collection practices. Providers are barred from using outbound collection calls, lawsuits, or third-party collections to recover unpaid proceeds unless fraud is involved.
- Data use and advertising limits. The statute restricts software from accessing a user's location (except to verify Indiana residency) and bans unsolicited advertisements without opt-in consent.
- Exemptions. Employers offering EWA directly to their workers and federally insured depository institutions are not subject to the licensing requirement.
Putting It Into Practice: With Indiana's enactment of HEA 1125, eight states have now adopted EWA-specific laws (previously discussed here, here, and here). Indiana's framework reflects a growing recognition that EWA products are not loans. As more states enact laws governing EWA products, providers should remain attentive to new legislative and regulatory developments that may impact their compliance obligations.
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