Introduced Version

SENATE BILL No. 542

_____

DIGEST OF INTRODUCED BILL

Citations Affected: IC 5-27.

Synopsis: Electronic payments to governmental bodies. Amends the definition of "electronic payment" for purposes of the statute governing electronic payments to a governmental body (defined as the state or a state agency) to include a payment made by means of any of the following: (1) Interactive voice response. (2) A digital wallet. (3) A digital currency. Provides that after June 30, 2025, a governmental body may not enter into or renew a contract: (1) that is made with a provider or vendor of payment processing services; and (2) the terms of which provide that any: (A) vendor transaction charge; (B) discount fee; or (C) other service charge or fee; assessed in connection with the contract is payable by the person who makes an electronic payment.

Effective: July 1, 2025.

Spencer

January 16, 2025, read first time and referred to Committee on Appropriations.

Introduced

First Regular Session of the 124th General Assembly (2025)

SENATE BILL No. 542

A BILL FOR AN ACT to amend the Indiana Code concerning state and local administration.

Be it enacted by the General Assembly of the State of Indiana:

SECTION 1. IC 5-27-2-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2025]: Sec. 3. "Electronic payment" means a payment by means of any of the following:

(1) A credit card.

(2) A debit card.

(3) A charge card.

(4) A stored value card.

(5) A bank card.

(6) An electronic check. or

(7) An electronic funds transfer, including: ~~but not limited to:~~

(A) Fed wire; and

(B) Automated Clearing House.

(8) Interactive voice response.

(9) A digital wallet.

(10) A digital currency.

SECTION 2. IC 5-27-3-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2025]:

Sec. 3. (a) Except as provided in subsection (c), a governmental body may:

(1) if the governmental body obtains the consent of each governmental body that is directly affected by the transaction, recognize the net amount remitted by the provider company as payment in full of an amount due the governmental entity for a service, a tax, a license, a permit, a fee, information, or any other amount due the governmental body that was paid by an electronic payment; or

(2) collect a sum for the vendor transaction charge, discount fee, or any other charge from the person who makes an electronic payment.

A fee under subdivision (2) may be collected as an enhanced service fee by a governmental body. The fee is a permitted additional charge under IC 24-4.5-3-202.

(b) A governmental body may pay a service charge or fee in connection with its agreement with the provider company.

(1) that is made with a provider company or any other vendor of payment processing services; and

(2) the terms of which provide that any:

(A) vendor transaction charge;

(B) discount fee; or

assessed in connection with the contract is payable by the person who makes an electronic payment, as described in subsection (a)(2).

(d) Subsection (c) does not:

(1) affect the validity of a contract that:

(A) is entered into by a governmental body and:

(i) a provider company; or

(ii) any other vendor of payment processing services;

before July 1, 2025; and

(B) provides that any:

(i) vendor transaction charge;

(ii) discount fee; or

(iii) other service charge or fee;

assessed in connection with the contract is payable by the person who makes an electronic payment, as described in subsection (a)(2); or

(2) prohibit the collection of any:

(A) vendor transaction charge;

(B) discount fee; or

assessed in connection with a contract described in subdivision (1), from a person making an electronic payment for an amount owed to the governmental body for any service, tax, license, permit, fee, information, or other amount owed to the governmental body.

Indiana S 542

Electronic Payments

2025 IN S 542

Indiana S 542

Electronic Payments

2025 IN S 542