Going forward, California will prohibit the inclusion of individual medical debt in credit scores. The state's automatic renewal law for online subscription services has been amended to make the previously cumbersome cancellation process as easy as a single click. Additionally, banks and credit unions will no longer be allowed to charge overdraft fees when a transaction is declined due to insufficient funds.

On the 24th, Governor Gavin Newsom signed a package of bills aimed at strengthening consumer protections and addressing issues that impose financial burdens on Californians, the state announced on the 25th.

Governor Newsom emphasized, "No one wants to be misled—whether it's for small subscription fees that are hard to cancel or massive medical debts that can push families into financial ruin. We are broadly enhancing protections for Californians and helping consumers save money." In total, Governor Newsom signed 19 bills into law.

The key provisions of the package include: removing medical debt from credit reports, simplifying subscription cancellation processes, and protecting consumers from unfair financial fees. California has described these laws as "setting new standards for transparency and accountability across industries."

First, the Medical Debt Relief Bill (Bill 1061) mandates the removal of medical debt from credit reports and prohibits debt collection agencies from reporting patients' medical debt information to credit agencies. Medical debt has long been a burden for millions of Californians, lowering credit scores and creating obstacles to renting housing or obtaining a mortgage. Senator Monique Limón, who introduced the bill, stated, "No Californian should be penalized in securing housing, loans, or employment because they received necessary medical care."

The second bill targets automatic renewal subscription services, which are easy to sign up for but difficult and complicated to cancel. This bill requires companies offering online subscription services to allow consumers to cancel subscriptions using the same method they used to sign up. For instance, someone who started a subscription online should be able to cancel it with a simple click. In June, the Federal Trade Commission (FTC) filed a civil lawsuit against Adobe, known for its Photoshop program, for hiding subscription cancellation fees and making it overly difficult for customers to cancel, causing inconvenience. Assemblymember Bill Essayli, who introduced the bill (AB 2863), explained, "Too many people in our communities are struggling financially, and this bill ensures that unwanted automatic subscription renewals can be canceled with just a few clicks."

The Unfair Fees Protection Bill prohibits banks and credit unions from charging fees when a transaction is declined due to insufficient funds. The bill also sets limits on the amount that credit unions can charge for overdraft fees. Governor Newsom's office explained that the bill's goal is to protect low-income Californians from being further financially burdened by various banking fees.

Additionally, Governor Newsom signed a bill that prohibits the construction and operation of new oil and gas facilities near schools and other educational institutions to prevent air pollution.

By Reporter Hongyong Park

<Hongyong Park>