--- title: "United States – Hawaii Payments Regulation Monitor | World Payments Monitor" canonical: https://payments.gi/jurisdictions/united-states-hawaii/ source_html: /jurisdictions/united-states-hawaii/index.html description: "United States – Hawaii payments and e-money regulation: 14 modules, 74 sourced findings, updated 2026-10-26. Licensing, safeguarding, stablecoins, AML/CFT." generated_at: 2026-10-26T19:20:26Z content_sha256: 472140d485ca7facb6d99174bc6aa513fb3ca720674f91df11af587a6797e854 generator: "fe-fleet/md-twin@1.0" --- # United States – Hawaii US-HI schema world-payments-v1 trajectory: not yet assessed Last updated 2026-10-26 · 14 modules · 74 sourced findings · 146 sources in the cumulative register Download report (PDF) Expand all 14 Modules 0 Moved this cycle 1 Key judgments 2 Open gaps 74 Findings 36 Tier-1 sources Confidence mix 6 confirmed 8 unpopulated (sums to 14 rendered modules; click to filter) No modules moved this cycle. United States federal law that applies in United States – Hawaii is covered once, on the [United States](/jurisdictions/united-states/) page. This page covers United States – Hawaii’s own layer: its own law, regulators and enforcement. ## Jurisdiction brief Jurisdiction lead brief 1,366 Full executive summary 513 ###### Latest update · 25 October 2026 #### Lead Signal Hawaii's digital-money environment saw a targeted consumer-protection tightening with the commencement of Act 224, which from October 1, 2026 bars kiosk operators from accepting United States currency in exchange for digital financial assets. Crypto-to-crypto and crypto-to-cash kiosk transactions remain lawful under the measure, so the restriction is confined to the cash-in leg of kiosk-based transactions rather than extending to kiosk operation generally. This sits against an unchanged underlying licensing posture: Hawaii's 2024 determination that digital-currency exchange activity does not meet the state's money-transmission definition continues to apply, meaning crypto exchanges operating in the state are not subject to state money-transmitter licensing. A parallel proposal for a dedicated state digital-asset custody framework for banks and credit unions, which would have required a full one-to-one reserve for custodied digital assets, was introduced this session but its final disposition has not been confirmed. Its outcome would materially affect how regulated depository institutions in Hawaii approach digital-asset custody services going forward. #### Other Developments A cash-handling rule affecting point-of-sale payment flows took effect in mid-2026. Act 159 permits, but does not require, merchants to round cash transactions to the nearest five cents from July 1, 2026, explicitly excluding electronic, card and instrument-based payments from its scope. The carve-out for electronic payments means the rule has no direct bearing on digital payment rails, though it is a useful marker of how Hawaii's legislature is treating cash as a payment instrument distinct from electronic alternatives in current policymaking. A comprehensive digital-asset licensing charter did not advance this session. The proposal, which would have established Hawaii's first bespoke licensing regime for digital-asset companies, was deferred in House committee in March 2026 and did not pass. Its failure leaves the current exemption-based approach to digital-currency activity as the only governing framework, absent a future revival of the charter concept. #### Cross-Monitor Connections The kiosk cash-ban functions as a consumer-protection and anti-fraud measure with direct relevance to financial-crime monitoring, since cash-funded kiosk transactions are a common vector in investment-scam typologies where a victim is directed to fund a kiosk transaction for onward crypto transfer. For payments infrastructure specifically, the measure narrows one on-ramp option without displacing the underlying licensing-exempt status of exchange and custody activity, meaning the structural payments landscape for digital assets in Hawaii is otherwise unchanged. #### Outlook Hawaii's posture toward digital money remains incremental: a narrow, incident-responsive restriction (the kiosk ban) and a stable core licensing exemption, with a comprehensive licensing and a bank-custody reserve framework both pending or unresolved. The disposition of the bank/credit-union custody bill is the most consequential open question for depository-institution digital-asset services and will be the central marker to watch going into the next legislative cycle. 3 earlier updates not shown here. ###### Standing brief · as of 5 July 2026 Written before the update above. Where they differ, the update is the more recent position. #### Lead Signal This cycle establishes the World Payments Monitor's baseline coverage of Hawaii (US-HI), the first structured sweep of the jurisdiction across all fourteen module codes in the WPM spine. The defining structural fact is architectural simplicity: Hawaii regulates nonbank payments activity through a single state statute, the Money Transmitters Modernization Act (HRS Chapter 489D), administered by the Division of Financial Institutions (DFI), with no separate electronic-money or prepaid-instrument licensing category and no bespoke stablecoin-issuance regime. Effective July 1, 2024, digital-currency and crypto activity was carved out of the 489D licensing perimeter entirely following the conclusion of the four-year Digital Currency Innovation Lab sandbox, meaning Hawaii's approach to digital assets is now a negative exemption rather than an affirmative licensing track, with mixed fiat/crypto businesses still required to license the USD-denominated leg of their activity. The result is a light-touch structural profile that increasingly delegates crypto and operational-resilience risk to federal backstops rather than building bespoke state infrastructure. The second defining signal of this baseline is the deteriorating state of correspondent-banking access across the Central and Western Pacific, a corridor in which Hawaii-headquartered banks, principally Bank of Hawaii, function as the primary U.S. settlement node. The region has seen a 60% drop in correspondent banking relationships since 2011, prompting the United States and Australia to convene a Pacific Banking Forum in 2024 bringing together Pacific finance ministers, central bank governors and commercial banks, alongside a US$77 million World Bank/Pacific Islands Forum remediation project. Bank of Hawaii's own regulatory disclosures acknowledge that AML-program effectiveness is a factor regulators weigh when reviewing bank mergers and BHC acquisitions, underscoring how correspondent access and compliance posture are now intertwined considerations for the state's largest settlement institutions. #### Other Developments Hawaii's banking-sector structure is consolidating. Hope Bancorp completed its approximately $78.6 million all-stock acquisition of Honolulu-based Territorial Bancorp on April 2, 2025, reshaping the state's thrift tier after Territorial shareholders had rebuffed a competing bid; First Hawaiian Bank remains the state's largest institution by assets, at nearly $25 billion, and has adopted third-party digital-banking platforms to modernize its commercial and payments operations. A further, larger commercial-banking transaction is now pending: Bank of Hope, parent of Hawaii's Territorial Savings unit following the 2025 deal, has announced an agreement to acquire SMBC's Americas commercial banking division, comprising roughly $2.5 billion in commercial and CRE loans and $2.7 billion in deposits on a net-book-value basis, with terms undisclosed and closing expected in the second half of 2026. Conduct and safeguarding oversight remains anchored in HRS 489D's bonding and permissible-investments framework, under which licensees must hold a bond or security device and maintain permissible investments matched to outstanding payment instruments, subject to commissioner waiver or letter-of-credit substitution. DFI's enforcement toolkit was exercised in March 2024, when it issued a cease-and-desist order against licensed money transmitter Sigue Corp after finding the firm did not meet HRS 489D's financial-condition requirements, following roughly 16,000 transactions worth about $9 million in the state the prior year. More broadly, Hawaii has no dedicated operational-resilience regime, interchange-fee-cap or surcharge-limit statute, or merchant-acquiring and high-risk-MCC statute; these gaps are filled respectively by DFI examination rules and the general breach-notification statute, by default Visa and Mastercard scheme rules, and by card-network rules layered on the general HRS 480 unfair-or-deceptive-practices framework. On the consumer-protection side, that same HRS 480 framework, enforced by the Office of Consumer Protection with treble-damages and attorney-fee remedies, is the only recourse available to Hawaii payments users, since the state has no authorized-push-payment fraud reimbursement scheme; FBI Honolulu-cited IC3 data show elder-fraud losses in the state nearly tripling from about $10 million to $28 million over the preceding three years. Innovation activity is now centered on Hawaii Technology Development Corporation's HI-CAP program, which deployed $62 million in federal funding secured in 2022 to expand capital access for small businesses and fintech-adjacent ventures, following the June 30, 2024 conclusion of the Digital Currency Innovation Lab sandbox. #### Cross-Monitor Connections Three findings from this baseline are flagged onward to the Financial Integrity Monitor rather than developed as WPM conclusions. First, Hawaii's unregulated digital-currency sector, the product of the 2024 licensing carve-out, now relies entirely on the federal FinCEN/BSA backstop, including MSB registration, for AML coverage, a gap whose illicit-finance dimension sits outside WPM's market-access remit. Second, the Pacific correspondent-banking de-risking trend carries a sanctions-evasion and informal-flow risk dimension beyond WPM's scope, given that a loss of banking access can push settlement activity into unregulated channels. Third, the sharply rising elder- and crypto-scam fraud losses reported via IC3 have a financial-crime and fraud-typology dimension that belongs with FIM's illicit-finance analysis rather than WPM's consumer-protection tracking. #### Outlook The nearest dated catalyst is the expected second-half-2026 close of Bank of Hope's acquisition of SMBC's Americas commercial banking division, which would further concentrate commercial-banking capacity among Hawaii-linked institutions. The Pacific Banking Forum's remediation track, backed by Treasury, Australia, the Pacific Islands Forum and the World Bank, will be the primary channel to watch for whether correspondent-banking access to the Central and Western Pacific stabilizes or continues to erode; any material shift would flow directly through Hawaii-headquartered settlement banks. Absent new state legislation, Hawaii's light-touch, single-statute regulatory perimeter is likely to remain stable, with the digital-currency carve-out and the absence of bespoke stablecoin, resilience, interchange, and acquiring regimes persisting as the baseline condition against which future cycles will be measured. Read full brief · 1366 words ###### Latest update · 14 September 2026 #### Regulatory Status Hawaii's payments-regulation posture tightened materially this cycle across licensing, merchant conduct, and consumer-fraud fronts. On licensing, the standing money-transmitter framework under Hawaii Revised Statutes Chapter 489D remains confirmed and in force, with the 2024 digital-currency exemption also confirmed and unchanged; pending Senate Bill 2757 would establish a dedicated digital-asset charter regime from January 1, 2027, and a separate bill, Senate Bill 3184, would authorize bank-channel digital-asset custody and staking from September 1, 2026, though the latter's sourcing remains thin. On merchant conduct, Act 159's cash-acceptance mandate took effect July 1, 2026 and is already binding on all Hawaii merchants. On consumer protection, Act 224's crypto-kiosk fraud controls, anticipated to take effect October 1, 2026, add a targeted fraud-screening and cooling-off regime to a previously unregulated payment instrument. #### Outlook The coming cycle's key questions are whether SB2757 reaches enactment in time for its 2027 effective date, whether SB3184's thinly-sourced September 2026 effective date holds, and how Act 224's October 2026 effective date plays out in practice for kiosk operators statewide. 2 earlier updates not shown here. ###### Standing brief · as of 5 July 2026 Written before the update above. Where they differ, the update is the more recent position. #### Regulatory Status Hawaii's payments regulatory perimeter is defined by a single state statute, the Money Transmitters Modernization Act (HRS Chapter 489D), administered by the Division of Financial Institutions, with no bespoke EMI/PPI, stablecoin, or DORA-equivalent framework; digital-currency activity was carved out of the licensing perimeter effective July 1, 2024 following conclusion of the Digital Currency Innovation Lab sandbox, leaving crypto oversight to federal BSA/AML and FinCEN backstops. Safeguarding of transmitted funds rests on HRS 489D's bonding and permissible-investments regime, reinforced by a full enforcement toolkit that DFI exercised against licensed money transmitter Sigue Corp in March 2024. Consumer protection runs through the general HRS Chapter 480 unfair-or-deceptive-practices framework enforced by the Office of Consumer Protection, with no dedicated authorized-push-payment fraud reimbursement scheme, even as FBI Honolulu-cited IC3 data show elder-fraud losses nearly tripling to about $28 million. Correspondent-banking access is under strain: Bank of Hawaii functions as a key U.S. settlement node for the Central and Western Pacific, a corridor that has seen a 60% drop in correspondent banking relationships since 2011, prompting a 2024 US Treasury-Australia Pacific Banking Forum and a US$77 million World Bank remediation project. Hawaii's banking sector is consolidating, illustrated by Hope Bancorp's approximately $78.6 million acquisition of Territorial Bancorp completed April 2, 2025, and by Bank of Hope's pending acquisition of SMBC's Americas commercial banking division expected to close in the second half of 2026. #### Outlook Absent new state legislation, Hawaii's light-touch, single-statute perimeter is likely to persist, with digital-currency, stablecoin, resilience, interchange, and acquiring activity continuing to be governed by exemption, scheme rules, or federal backstop rather than bespoke state frameworks. The nearest dated catalyst is the expected second-half-2026 close of the Bank of Hope-SMBC transaction; the Pacific Banking Forum's remediation track is the primary channel to watch for whether correspondent-banking access to Hawaii's Pacific corridors stabilizes or continues to erode. Read full brief · 513 words × 14 of 14 modules Signal Moved Judgment Gap Density Comfortable Compact Expand all sources Reset all Selections OR within a group, AND across groups. Press / to search. ### W1aLicensing, Authorisation & Market AccessConfirmedconfirmed 2026-07-05▾# Hawaii's Money Transmitters Modernization Act (HRS Ch.489D) is administered by DCCA/DFI. Since 1 July 2024, standalone digital-asset activity has not required a Hawaii MT licence (regulator-interpretation-based, less durable than statutory exemptions elsewhere). SB 2757 SD1 (2026) would reverse this via a new Digital Asset Charter regime; it advanced out of Senate CPN/LBT as amended (SD1), referred to WAM/JDC; final 2026-session enactment status unconfirmed. Horizon · 2027-Q1 (± a year) Hawaii SB2757 Digital Asset Charters Proposed · Tier 1 source Horizon · 2027-01-01 (± six months) Digital Asset Charters (SB2757) effective Consultation · Tier 1 source Horizon · 2026-09-01 (± a quarter) SB3184 bank digital-asset custody authorisation effective Proposed · Tier 4 source Horizon · 2027-01-01 (± six months) Hawaii Digital Asset Charter program takes effect Consultation · Tier 1 source Standing sub-brief · as of 5 July 2026 265 words · last cycle 2026-09-28 #### Licensing, Authorisation & Market Access Hawaii regulates payments and money-transmission activity through a single state-level nonbank licensing perimeter: the Money Transmitters Modernization Act, codified at HRS Chapter 489D and administered by the Division of Financial Institutions (DFI), part of the Department of Commerce and Consumer Affairs. Money transmission activity in Hawaii requires a state license under this framework, and licensees are additionally subject to NMLS registration; there is no separate electronic-money or prepaid-instrument (EMI/PPI) licensing category, meaning nonbank payments providers of every stripe -- from remittance firms to bill-payment processors -- fall under the same statutory umbrella as traditional money transmitters. The most significant recent development in this module is negative rather than additive: effective July 1, 2024, digital-currency and cryptocurrency activity was carved out of the HRS 489D money-transmission definition entirely, following the conclusion of Hawaii's four-year Digital Currency Innovation Lab (DCIL) regulatory sandbox. Digital-currency-only businesses no longer require a Hawaii money transmitter license, though mixed fiat/crypto businesses must still license the USD-denominated leg of their operations. This is a negative carve-out approach -- removing an activity from the licensing perimeter -- rather than an affirmative digital-asset licensing track of the kind some other US states have pursued, and it leaves crypto-specific consumer protection and prudential oversight to federal law alone. #### Outlook Absent new state legislation, Hawaii's licensing perimeter is likely to remain a single-statute structure indefinitely; no bespoke EMI/PPI category or digital-asset licensing track is signaled. The DCIL's conclusion suggests Hawaii's default posture toward future fintech innovation will be exemption-based rather than sandbox-to-license, a structurally lighter-touch model than jurisdictions building affirmative crypto-licensing regimes. Read full sub-brief · 265 words Periodic update · new data 2026-09-14 #### Licensing, Authorisation & Market Access Hawaii's standing money-transmitter licensing framework is Hawaii Revised Statutes Chapter 489D, administered by the Division of Financial Institutions through the Nationwide Multistate Licensing System, with an aggregate fee cap of up to $15,000. This is a confirmed, Tier-1-sourced baseline. Layered onto that framework since July 1, 2024 is a confirmed exemption: digital-currency and digital-asset activity does not require a Hawaii money-transmitter license, while USD-denominated money transmission remains fully licensed. This exemption followed the conclusion of the state's Digital Currency Innovation Lab pilot and reflects a determination by the Division of Financial Institutions that digital-currency business does not fit the statutory money-transmission definition. That exemption is now the subject of active legislative pressure on two separate fronts, distinguished by the bank-versus-nonbank channel. On the nonbank side, Senate Bill 2757 (Digital Asset Charters) passed the Senate Labor and Technology Committee and the Senate Commerce and Consumer Protection Committee by five-to-zero votes each in February 2026 and was engrossed to the House by March 2026; it would establish a dedicated Division of Financial Institutions charter and licensing program for digital-asset companies from January 1, 2027, closing the current exemption gap for nonbank payment-institution and e-money-institution-type digital-asset operators. On the bank side, Senate Bill 3184 would separately authorize state-chartered banks and credit unions to offer digital-asset custody, staking, and fiduciary transaction services under Division of Financial Institutions oversight, with an anticipated effective date of September 1, 2026; this claim is held at probable confidence given its reliance on a Tier-4 bill-tracking aggregator as the sole source this cycle, with no primary bill-text cross-check performed. The bank-versus-nonbank distinction matters structurally: SB2757 creates a new licensing pathway specifically for nonbank digital-asset companies, while SB3184 extends existing bank/credit-union chartering authority to cover digital-asset custody and staking activities, meaning Hawaii's digital-asset market-access architecture, if both bills proceed, would develop along two parallel tracks rather than a single unified regime. #### Outlook The key near-term milestone is whether SB2757 clears the House and reaches the Governor's desk in time to support its January 1, 2027 effective date; a companion question is whether SB3184's September 1, 2026 effective date will hold given the current thin sourcing on that bill. Confirmation of primary bill text for SB3184, rather than continued reliance on a secondary aggregator, would materially improve confidence in that specific development. 2 earlier distinct update(s) Periodic update · new data 2026-09-08 #### Licensing, Authorisation & Market Access Hawaii's licensing and market-access posture for digital-asset and payment firms is defined this cycle by a nonbank-specific carve-out rather than any change to bank-supervised money transmission. The Hawaii Division of Financial Institutions has determined, effective July 1, 2024, that digital currency and digital-asset trading and transmission activity is not subject to the state's Money Transmitters Act licensing requirement, following conclusion of the state's Digital Currency Innovation Lab. This determination is squarely a nonbank payment-institution and e-money-institution matter: it relieves standalone crypto-asset operators of a state money-transmitter licensing burden that would otherwise apply to nonbank payment firms, while leaving bank-supervised payment activity entirely untouched. Two Tier-1 Hawaii government sources, the Department of Commerce and Consumer Affairs and the Governor's newsroom, corroborate the determination. Comparative analysis places Hawaii among only seven US jurisdictions where standalone virtual-currency activity does not require a money-transmitter license, but this analysis also flags a durability concern specific to market-access planning: Hawaii's exemption rests on regulator interpretation, not statutory amendment, unlike the express statutory exemptions some peer states have enacted. For a nonbank payment or crypto-asset firm evaluating Hawaii market entry, this means today's favorable market-access posture carries a materially higher reversal risk than in states where the exemption is written into statute. Hawaii's 2026 legislature is separately considering SB2757, the Digital Asset Charters bill, which would introduce a new state chartering framework for digital-asset businesses. SB2757's own legislative findings describe the digital-asset industry as largely unregulated in the United States, an implicit acknowledgment of the licensing gap the 2024 determination created. As introduced, SB2757 has not been enacted and remains a proposed pathway rather than a licensing option available today. #### Outlook Market-access planning for Hawaii should treat the current crypto money-transmitter exemption as provisional rather than settled, given its non-statutory basis. SB2757's progress through the 2026 session, with an expected decision horizon in 2027 Q1, is the clearest marker of whether Hawaii moves toward a formal chartering regime or continues to rely on the more reversible regulator-interpretation approach. Periodic update · new data 2026-08-11 #### Licensing, Authorisation & Market Access Since 1 July 2024, Hawaii's DCCA/Division of Financial Institutions has treated standalone digital-currency and digital-asset activity as falling outside the state's money transmitter licensing requirement under HRS Chapter 489D, following the closure of the state's Digital Currency Innovation Lab; this is a nonbank payment-institution/EMI-style licensing perimeter, not a banking-charter matter, and the exemption rests on regulator interpretation rather than statute. SB 2757 SD1 would reverse this position, creating a new Digital Asset Charter licensing and oversight program for digital-asset companies operating in Hawaii; the bill advanced out of Senate committee as amended (SD1) and was referred to Ways and Means and Judiciary, with final 2026-session enactment status unconfirmed as of session close. The exemption has never extended to USD money transmission: where a company conducts both digital-asset activity and USD money transmission, a Hawaii money transmitter licence is still required for the USD leg under Chapter 489D, so bifurcated licensing treatment already applies within the current regime. Comparative context underscores the exemption's fragility: of roughly seven US jurisdictions without a standalone virtual-currency money-transmitter licensing requirement, Hawaii's rests on regulator interpretation, as do Texas's and South Carolina's, rather than on statute, as in Montana, Wyoming, Utah, and New Hampshire, leaving it comparatively more exposed to a reversal attempt such as SB 2757 SD1. The interpreter's standing assessment rates this development's impact as ELEVATED, reflecting both the exemption's structural reliance on interpretation rather than statute and active legislative appetite, evidenced by SB 2757 SD1, to close it; this sits within a broader pattern of US states narrowing crypto money-transmitter exemptions. Hawaii's regulatory direction on this question is assessed as uncertain, with the trajectory marked watch pending the bill's outcome. #### Outlook Final enactment status of SB 2757 SD1 is the determinative watch item for the next cycle. Enactment would move Hawaii from the regulator-interpretation group into the statutory-licensing group of states, a categorical shift in market-access conditions for digital-asset firms; continued non-enactment leaves the current, comparatively fragile exemption in place pending the next legislative session. Evidence 7 Sources and findings (7) - T1[https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm](https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/dfi/](https://cca.hawaii.gov/dfi/)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf](https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/dfi/new-law-money-transmitters/](https://cca.hawaii.gov/dfi/new-law-money-transmitters/)retrieved 2026-07-05 - T4[https://cornerstonelicensing.com/money-transmitter-laws/hawaii-money-transmitter-regulations/](https://cornerstonelicensing.com/money-transmitter-laws/hawaii-money-transmitter-regulations/)retrieved 2026-07-05 - T3[https://ankura.com/insights/navigating-the-new-digital-currency-guidelines-in-hawaii-opportunities-for-fintech-innovation](https://ankura.com/insights/navigating-the-new-digital-currency-guidelines-in-hawaii-opportunities-for-fintech-innovation)retrieved 2026-07-05 - T2[https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/](https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/)retrieved 2026-07-05 ### W1bConduct, Safeguarding & PromotionsConfirmedconfirmed 2026-07-05▾# Safeguarding of transmitted funds rests on HRS 489D's permissible-investments/statutory-trust and bonding requirements, with authorized-delegate contract discipline and a full formal-enforcement toolkit (cease-and-desist, consent orders, civil/criminal penalties). Broader conduct obligations for payments providers are layered on top by Hawaii's general Unfair or Deceptive Acts or Practices statute (HRS 480-2), enforced by the AG and Office of Consumer Protection. Horizon · 2026-07-01 (± a quarter) Act 159 cash-acceptance mandate effective In force · Tier 1 source Standing sub-brief · as of 5 July 2026 204 words · last cycle 2026-09-28 #### Conduct, Safeguarding & Promotions HRS 489D-7 and 489D-8 impose Hawaii's core safeguarding mechanism for nonbank money transmitters: licensees must maintain a bond or other security device and hold permissible investments matched to outstanding payment-instrument obligations. The commissioner may waive certain requirements where posted security already exceeds outstanding volume, and a letter of credit is acceptable as substitute security -- a flexible, principles-based safeguarding regime rather than a prescriptive trust-account mandate. This bond-and-permissible-investments structure is the core customer-fund-protection mechanism for Hawaii's nonbank payments sector, layered underneath the general conduct obligations imposed by HRS Chapter 480's Unfair or Deceptive Acts or Practices statute. DFI's enforcement toolkit is not merely theoretical: in March 2024, the division issued a cease-and-desist order to licensed money transmitter Sigue Corp after determining the firm did not meet HRS 489D's financial-condition requirements, following approximately 16,000 transactions worth about $9 million conducted in Hawaii the prior year. The action illustrates DFI's 489D enforcement toolkit in live operation against a licensee, rather than as a dormant statutory power. #### Outlook No Hawaii-specific financial-promotion enforcement action distinct from the Sigue Corp cease-and-desist has been identified this sweep; conduct and safeguarding oversight is expected to remain anchored in the existing bonding and permissible-investments framework absent new rulemaking. Read full sub-brief · 204 words Periodic update · new data 2026-09-14 #### Conduct, Safeguarding & Financial Promotions Act 159 (SB3255 CD1) took effect July 1, 2026 and requires all merchants operating in Hawaii to accept cash as a form of payment for in-person goods and services. The same Act permits merchants to round cash transactions to the nearest five cents, a direct legislative response to the U.S. Treasury's cessation of penny production; card, electronic-funds-transfer, check, gift-card and money-order payments are explicitly exempted from the rounding provision, meaning the rounding permission applies to cash transactions specifically and does not extend to other payment instruments. This is a confirmed, Tier-1-sourced, already-in-force conduct rule. The practical effect of Act 159 is to impose a payment-acceptance mandate on the merchant side of the transaction rather than on payment-service-provider licensing or safeguarding obligations; it applies equally to bank-affiliated and non-bank payment-service-provider-facilitated merchant relationships, since the obligation runs to the merchant accepting payment rather than to any particular payment-processing channel. No financial-promotions-specific development was identified for Hawaii this cycle beyond this cash-acceptance mandate. #### Outlook Act 159 is already in force, so the principal open question going forward is one of merchant compliance and enforcement uptake rather than legislative uncertainty; no enforcement mechanism or penalty structure for non-compliant merchants was identified within this cycle's sourcing, which is itself worth monitoring as the law's first full retail cycle plays out. Evidence 6 Sources and findings (6) - T1[https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf](https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm](https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf](https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/dfi/mt-faq/](https://cca.hawaii.gov/dfi/mt-faq/)retrieved 2026-07-05 - T1[https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm](https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm)retrieved 2026-07-05 - T2[https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/](https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/)retrieved 2026-07-05 ### W2Stablecoins & Digital Money1 judgment1 gapConfirmedconfirmed 2026-07-05▾# Hawaii has no bespoke stablecoin-issuance or reserve/redemption statute. Instead, following a four-year regulatory sandbox (the Digital Currency Innovation Lab, DCIL), DFI determined digital-currency activity does not fit the HRS 489D money-transmission definition; effective July 1, 2024, digital-currency companies no longer need a Hawaii money transmitter license and operate as unregulated businesses subject only to applicable federal requirements (FinCEN, SEC, FINRA). Key judgment — Probable · impact Hawaii's digital-asset posture remains narrow and consumer-protection-driven rather than comprehensive licensing; the kiosk ban and cash-rounding rule are incremental, not structural, changes. claims: none recorded Open gap — wpm-int-1 Final legislative disposition of SB3184 (bank/credit-union digital-asset custody bill) was not confirmed this cycle. Private-company/startup signal is under-indexed per bias-correction guidance; Hawaii-based fintech funding rounds may exist but were not surfaced this cycle. Horizon · 2026-Q4 (± six months) Hawaii SB3184 bank/credit-union digital-asset custody bill disposition Proposed · Tier 1 source Standing sub-brief · as of 5 July 2026 147 words · last cycle 2026-10-25 #### Stablecoins & Digital Money The Digital Currency Innovation Lab (DCIL), Hawaii's four-year fintech sandbox, concluded on June 30, 2024. DFI determined that digital-currency company activities do not align with the HRS 489D money-transmission definition, resulting in no license requirement for digital-currency activity effective July 1, 2024 -- a four-year sandbox concluded with a negative-carve-out outcome rather than a new licensing track. Hawaii has no dedicated stablecoin-issuer authorisation, reserve, or redemption regime akin to the EU's MiCA framework for e-money and asset-referenced tokens; the state's approach is the digital-currency negative carve-out described above rather than an affirmative licensing track. No Hawaii-specific CBDC pilot or FedNow instant-payments policy overlay has been identified. #### Outlook Hawaii's digital-money posture is now deregulating rather than building bespoke infrastructure; absent a change in statutory language, stablecoin issuance and digital-currency activity will continue to sit outside the state licensing perimeter, backstopped only by federal requirements. Read full sub-brief · 147 words Periodic update · new data 2026-10-25 #### Stablecoins & Digital Money Hawaii's treatment of digital money narrowed in a targeted way through Act 224, which from October 1, 2026 makes it unlawful for a kiosk operator to accept United States currency in exchange for a digital financial asset. The prohibition is specific to the cash-in channel: crypto-to-crypto and crypto-to-cash kiosk transactions remain lawful. This is a consumer-protection-driven measure rather than a redesign of the state's digital-money licensing architecture, and it leaves the 2024 exemption of digital-currency exchange activity from state money-transmitter licensing fully intact. Separately, a bill addressing bank and credit-union custody of digital assets was introduced this session, proposing that institutions holding custodied digital assets maintain not less than a one-to-one full reserve against those holdings. This would be a materially significant development for any regulated depository institution in Hawaii considering digital-asset custody services, since a full-reserve requirement is a substantive prudential constraint distinct from the state's general licensing exemption for exchange activity. However, the bill's final legislative disposition was not confirmed, so whether it was enacted, failed, or carried over remains an open question. A third development, the proposed digital-asset licensing charter, would have introduced Hawaii's first comprehensive state licensing regime for digital-asset companies. That proposal was deferred by a House committee in March 2026 and did not pass this session, leaving the exemption-based approach as the sole governing framework for exchange and custody activity for the foreseeable future, absent a revival of the charter concept in a subsequent session. Taken together, these three threads describe a jurisdiction where digital money is lightly licensed at the exchange/custody level, newly restricted at a specific cash-handling channel, and potentially facing a more substantive prudential requirement at the bank-custody level pending legislative resolution. The overall direction remains incremental rather than structural: no single development redefines Hawaii's digital-money regulatory architecture, but together they indicate a legislature engaging with digital-asset issues piecemeal rather than through comprehensive reform. #### Outlook The most consequential near-term question is the final disposition of the bank/credit-union custody reserve bill, which would represent the first prudential digital-asset requirement imposed on a specific class of regulated institution in Hawaii. Confirmation of its outcome, together with any implementing guidance issued under the kiosk prohibition, would be the key markers to track going into the next legislative session. Evidence 6 Sources and findings (6) - T1[https://governor.hawaii.gov/newsroom/dcca-release-hawaii-digital-currency-innovation-lab-to-conclude/](https://governor.hawaii.gov/newsroom/dcca-release-hawaii-digital-currency-innovation-lab-to-conclude/) - T1[https://www.htdc.org/state-of-hawaiis-digital-currency-innovation-lab-extended-to-june-30-2024/](https://www.htdc.org/state-of-hawaiis-digital-currency-innovation-lab-extended-to-june-30-2024/)retrieved 2026-07-05 - T3[https://www.gtlaw.com/en/insights/2024/2/hawaiis-money-transmitters-modernization-act-will-no-longer-apply-to-cryptocurrency-activities](https://www.gtlaw.com/en/insights/2024/2/hawaiis-money-transmitters-modernization-act-will-no-longer-apply-to-cryptocurrency-activities)retrieved 2026-07-05 - T3[https://ankura.com/insights/navigating-the-new-digital-currency-guidelines-in-hawaii-opportunities-for-fintech-innovation](https://ankura.com/insights/navigating-the-new-digital-currency-guidelines-in-hawaii-opportunities-for-fintech-innovation)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/dfi/news-releases/digital-currency-innovation-lab-concludes/](https://cca.hawaii.gov/dfi/news-releases/digital-currency-innovation-lab-concludes/)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm](https://files.hawaii.gov/dcca/dfi/Laws_html/HRS0489D/HRS_0489D-.htm)retrieved 2026-07-05 ### W3Operational Resilience & Critical InfrastructureProbableconfirmed 2026-07-05▾# Hawaii lacks a DORA-style ICT/critical-third-party resilience regime. Operational resilience for licensed financial institutions runs through DFI's examination/enforcement rules (HAR Chapters 26-27) and the state's general security-breach notification law (HRS Chapter 487N), under which federally-compliant financial institutions are deemed compliant. Kept on Dataprotection.gi, not restated here: data and cloud switching obligations on service providers, including notice periods and charges. [Open its jurisdiction pages on Dataprotection.gi →](https://dataprotection.gi/jurisdictions/) Standing sub-brief · as of 5 July 2026 94 words · last cycle 2026-07-05 #### Operational Resilience & Critical Infrastructure Hawaii lacks a DORA-style ICT and critical-third-party resilience regime. Operational resilience for licensed financial institutions instead runs through DFI's examination and enforcement rules under Hawaii Administrative Rules Chapters 26-27, alongside the state's general security-breach notification statute, HRS Chapter 487N, under which federally-compliant financial institutions are deemed compliant. #### Outlook No dedicated operational-resilience or critical-third-party oversight regime is signaled for Hawaii; the jurisdiction is likely to continue relying on general examination rules and breach-notification law, with any future shift more likely to originate at the federal level than the state level. no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T3[https://www.perkinscoie.com/en/news-insights/security-breach-notification-chart-hawaii.html](https://www.perkinscoie.com/en/news-insights/security-breach-notification-chart-hawaii.html)retrieved 2026-07-05 - T3[https://www.mintz.com/mintz-matrix/hawaii](https://www.mintz.com/mintz-matrix/hawaii)retrieved 2026-07-05 - T4[https://www.insureon.com/small-business-insurance/cyber-liability/data-breach-laws/hawaii](https://www.insureon.com/small-business-insurance/cyber-liability/data-breach-laws/hawaii)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/hawaii-administrative-rules/](https://cca.hawaii.gov/hawaii-administrative-rules/)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/hawaii-administrative-rules/](https://cca.hawaii.gov/hawaii-administrative-rules/)retrieved 2026-07-05 ### W4Scheme & Network ComplianceProbableconfirmed 2026-07-05▾# Hawaii has no state-level interchange-fee cap or surcharge-limit statute; two attempts to ban credit-card surcharging (2013-2014) failed to pass. Card-scheme (Visa/Mastercard) rules govern surcharge caps and disclosure by default, while merchant discount fee income earned by chapter-241-taxable financial institutions is exempt from the state general excise tax as a core-banking function. Standing sub-brief · as of 5 July 2026 71 words · last cycle 2026-07-05 #### Scheme & Network Compliance Hawaii has no state-level interchange-fee cap or surcharge-limit statute. Two legislative attempts to ban credit-card surcharging, in 2013 and 2014, failed to pass the legislature, leaving Visa and Mastercard scheme rules to govern surcharge caps and disclosure by default. #### Outlook With no live legislative vehicle identified, scheme rules are expected to remain the default governing mechanism for surcharge caps and disclosure in Hawaii for the foreseeable future. no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T1[https://www.capitol.hawaii.gov/sessions/session2013/bills/SB470_HD2_.htm](https://www.capitol.hawaii.gov/sessions/session2013/bills/SB470_HD2_.htm)retrieved 2026-07-05 - T4[https://merchantcostconsulting.com/lower-credit-card-processing-fees/credit-card-surcharge-laws-by-state/](https://merchantcostconsulting.com/lower-credit-card-processing-fees/credit-card-surcharge-laws-by-state/)retrieved 2026-07-05 - T4[https://ebizcharge.com/blog/credit-card-surcharging-a-state-by-state-legal-analysis/](https://ebizcharge.com/blog/credit-card-surcharging-a-state-by-state-legal-analysis/)retrieved 2026-07-05 - T1[https://files.hawaii.gov/tax/legal/tir/1990_09/tir06-03.pdf](https://files.hawaii.gov/tax/legal/tir/1990_09/tir06-03.pdf)retrieved 2026-07-05 - T4[https://www.hawaiinewsnow.com/story/19030613/swiping-your-credit-card-may-soon-be-more-costly/](https://www.hawaiinewsnow.com/story/19030613/swiping-your-credit-card-may-soon-be-more-costly/)retrieved 2026-07-05 ### W5Payment Corridor Dynamics1 gapProbableconfirmed 2026-07-05▾# Hawaii's principal payment corridors run outbound to the Philippines (reflecting the state's large Filipino community) and across the Central/Western Pacific (Guam, Micronesia, historically the Marshall Islands, American Samoa) via Hawaii-headquartered banks. Pacific corridor costs remain among the highest globally, and cross-border settlement access for these corridors is increasingly constrained by correspondent-banking de-risking. Open gap — wpm-int-2 No Hawaii-specific instant-payments/corridor developments were found this cycle. Emerging-market rail data (mobile money) is a known under-indexed bias category per methodology §11. Standing sub-brief · as of 5 July 2026 121 words · last cycle 2026-07-05 #### Payment Corridor Dynamics Hawaii's principal outbound remittance corridor runs to the Philippines, reflecting the state's large Filipino community, served by licensed money-transfer operators such as BayaniPay, an agent of BDO Remit USA. Pacific corridor costs remain among the highest globally, and correspondent-banking de-risking is increasingly constraining settlement access for these high-volume Pacific and Philippines remittance flows. The World Bank's Remittance Prices Worldwide database benchmarks the cost of the US-to-Philippines corridor, providing an ongoing reference point for corridor-cost monitoring relevant to Hawaii's outbound Filipino remittance flows. #### Outlook Corridor cost and access pressure is likely to persist; the Philippines corridor remains served by licensed operators while broader Pacific corridors face rising correspondent-banking constraints that could raise costs or reduce settlement options over time. Read full sub-brief · 121 words no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T4[https://www.bayanipay.com/send-money](https://www.bayanipay.com/send-money)retrieved 2026-07-05 - T3[https://www.lowyinstitute.org/publications/reducing-remittance-costs-pacific-islands](https://www.lowyinstitute.org/publications/reducing-remittance-costs-pacific-islands)retrieved 2026-07-05 - T1[https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777](https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777)retrieved 2026-07-05 - T1[https://home.treasury.gov/news/press-releases/jy2463](https://home.treasury.gov/news/press-releases/jy2463)retrieved 2026-07-05 - T1[https://remittanceprices.worldbank.org/corridor/United-States/Philippines](https://remittanceprices.worldbank.org/corridor/United-States/Philippines) Applies beyond this jurisdiction (World Bank)retrieved 2026-07-05 ### W6Industry Structure & CommercialProbableconfirmed 2026-07-05▾# Hawaii's banking market is led by First Hawaiian Bank, Bank of Hawaii, and Central Pacific Financial Corp, with the thrift tier reshaped by Hope Bancorp's 2025 acquisition of Territorial Bancorp. Hawaii's credit-union sector (Hawaii State FCU, HawaiiUSA FCU, Hawaii Federal Credit Union and others) is following the national trend of fintech-partnership-driven digital/payments modernization rather than in-house build. Standing sub-brief · as of 5 July 2026 128 words · last cycle 2026-07-05 #### Industry Structure & Commercial Dynamics Hope Bancorp completed its approximately $78.6 million all-stock acquisition of Honolulu-based Territorial Bancorp, parent of Territorial Savings Bank (roughly $2.17 billion in assets, 28 branches), on April 2, 2025, after Territorial shareholders rebuffed a competing bid -- a deal that reshapes Hawaii's thrift tier. First Hawaiian Bank remains Hawaii's largest financial institution, with total assets of nearly $25 billion and branches spanning Hawaii, Guam and Saipan; the bank has adopted third-party digital-banking and lending platforms to modernize its commercial and payments operations. #### Outlook Consolidation among Hawaii's thrift and community-bank tier is likely to continue, reinforced by the pending Bank of Hope-SMBC Americas transaction tracked under W13; credit unions are expected to continue leaning on fintech partnerships rather than in-house build for payments modernization. Read full sub-brief · 128 words no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T1[https://www.sec.gov/Archives/edgar/data/0000701347/000070134725000011/cpf_irdeckmarch2025xfina.htm](https://www.sec.gov/Archives/edgar/data/0000701347/000070134725000011/cpf_irdeckmarch2025xfina.htm)retrieved 2026-07-05 - T1[https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777](https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777)retrieved 2026-07-05 - T2[https://www.bankingdive.com/news/hope-bancorp-completes-merger-with-hawaii-bank-territorial/744377/](https://www.bankingdive.com/news/hope-bancorp-completes-merger-with-hawaii-bank-territorial/744377/)retrieved 2026-07-05 - T3[https://www.q2.com/company/news/pr/first-hawaiian-bank-selects-q2-to-transform-its-commercial-lending-business](https://www.q2.com/company/news/pr/first-hawaiian-bank-selects-q2-to-transform-its-commercial-lending-business)retrieved 2026-07-05 - T3[https://www.pymnts.com/credit-unions/2026/credit-unions-take-stakes-in-fintechs-to-control-the-roadmap/](https://www.pymnts.com/credit-unions/2026/credit-unions-take-stakes-in-fintechs-to-control-the-roadmap/)retrieved 2026-07-05 ### W7Legal & LitigationConfirmedconfirmed 2026-07-05▾# Hawaii payments litigation activity centers on DFI's formal enforcement toolkit (cease-and-desist, consent orders, civil/criminal penalties under HRS 489D) and on the general HRS 480 Unfair or Deceptive Acts or Practices statute, which has generated Ninth Circuit case law on credit-card-provider and class-action UDAP claims. Standing sub-brief · as of 5 July 2026 110 words · last cycle 2026-07-05 #### Legal & Litigation DFI's formal enforcement toolkit under HRS 489D-24 through 489D-29 includes license suspension or revocation, cease-and-desist orders, consent orders, civil penalties, and criminal penalties, with false statements constituting a class C felony. Separately, Ninth Circuit case law under HRS 480-2 and 480-13 has addressed credit-card-provider unfair-or-deceptive-practices claims, holding they are not preempted by the National Bank Act and do not require individual reliance proof for class certification. #### Outlook No major new payments-specific litigation beyond this established UDAP case law and the Sigue Corp enforcement action was identified this sweep; the existing enforcement toolkit and case law are expected to remain the operative framework absent a new landmark filing. Read full sub-brief · 110 words no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T2[https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/](https://www.staradvertiser.com/2024/03/17/breaking-news/dfi-orders-sigue-corp-to-stop-transmitting-money-in-hawaii/)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf](https://files.hawaii.gov/dcca/dfi/hrs/chapter-489d-_0109_.pdf)retrieved 2026-07-05 - T1[https://law.justia.com/codes/hawaii/title-26/chapter-480/section-480-2/](https://law.justia.com/codes/hawaii/title-26/chapter-480/section-480-2/)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/har/chapter-27-har.pdf](https://files.hawaii.gov/dcca/dfi/har/chapter-27-har.pdf)retrieved 2026-07-05 - T1[https://files.hawaii.gov/dcca/dfi/har/chapter-27-har.pdf](https://files.hawaii.gov/dcca/dfi/har/chapter-27-har.pdf)retrieved 2026-07-05 ### W8Merchant Acquiring & RiskProbableconfirmed 2026-07-05▾# Hawaii has no bespoke merchant-acquiring license or high-risk-MCC statute; acquiring/merchant-services activity is governed by card-network rules, the general HRS 480 UDAP framework for merchant-consumer disputes, and a favorable general-excise-tax treatment of merchant-discount income earned by financial institutions. Standing sub-brief · as of 5 July 2026 68 words · last cycle 2026-09-28 #### Merchant Acquiring & Risk Hawaii has no bespoke merchant-acquiring license or high-risk-MCC statute; acquiring activity is governed instead by card-network rules and the general HRS 480 unfair-or-deceptive-practices framework for merchant-consumer disputes, alongside favorable general-excise-tax treatment of merchant-discount income earned by financial institutions. #### Outlook Absent new legislation, merchant acquiring in Hawaii will continue to be governed by card-network rules and general consumer-protection law rather than a bespoke state regime. Periodic update · new data 2026-09-14 #### Merchant Acquiring & Risk Act 159's cash-acceptance mandate, effective July 1, 2026, bears directly on merchant-facing payment acceptance policy in Hawaii: merchants can no longer decline cash as a payment method for in-person transactions, a constraint on the growing trend toward cashless or card-only retail environments. The permitted nickel-rounding of cash transactions is a narrow accommodation responding to the discontinuation of penny production, and it applies only to cash; merchants continue to process card, electronic-funds-transfer, check, gift-card and money-order payments without any rounding adjustment. This is a confirmed, Tier-1-sourced, in-force development. From a merchant-acquiring risk perspective, this development is a conduct-side constraint rather than an acquiring-relationship or interchange development; it does not alter card-scheme rules, acquirer underwriting practices, or merchant category code treatment. Its principal risk-management relevance is operational: point-of-sale systems and staff training across Hawaii's merchant base must accommodate mandatory cash acceptance and correct nickel-rounding calculation, a compliance burden that falls on the merchant rather than on the acquirer or payment processor directly. #### Outlook Watch for whether any acquirer- or processor-level guidance emerges to help merchants operationalize the nickel-rounding calculation correctly at the point of sale, since incorrect rounding could itself become a source of consumer complaints or Office of Consumer Protection scrutiny even though the underlying mandate is squarely a merchant obligation rather than an acquirer obligation. Evidence 5 Sources and findings (5) - T1[https://files.hawaii.gov/tax/legal/tir/1990_09/tir06-03.pdf](https://files.hawaii.gov/tax/legal/tir/1990_09/tir06-03.pdf)retrieved 2026-07-05 - T4[https://ebizcharge.com/blog/credit-card-surcharging-a-state-by-state-legal-analysis/](https://ebizcharge.com/blog/credit-card-surcharging-a-state-by-state-legal-analysis/)retrieved 2026-07-05 - T1[https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm](https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm)retrieved 2026-07-05 - T4[https://payatlas.com/regulator/dobi-hi-4676](https://payatlas.com/regulator/dobi-hi-4676)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/hawaii-revised-statutes/](https://cca.hawaii.gov/hawaii-revised-statutes/)retrieved 2026-07-05 ### W9Product Innovation & Market Developmentlimited signalProbableconfirmed 2026-07-05▾# Hawaii's principal innovation vehicle was the DCIL fintech/digital-currency sandbox (2020-2024), since concluded, alongside HTDC's HI-CAP capital-access program for startups. Product innovation in payments is otherwise delivered through bank/credit-union fintech partnerships and accelerator relationships (e.g., Bank of Hawaii-Mana Up) rather than a dedicated open-banking or CBDC-pilot regime. Standing sub-brief · as of 5 July 2026 80 words · last cycle 2026-10-25 #### Product Innovation & Market Development Hawaii Technology Development Corporation's HI-CAP program deployed $62 million in federal funding secured in 2022 to expand capital access for Hawaii small businesses, startups, and entrepreneurs, including fintech-adjacent ventures, alongside the now-concluded Digital Currency Innovation Lab sandbox that ran from 2020 to 2024. #### Outlook With the DCIL sandbox concluded, HI-CAP and bank/credit-union fintech partnerships are likely to remain Hawaii's principal innovation vehicles; no Hawaii-specific FedNow overlay or CBDC pilot is signaled for the coming period. Periodic update · new data 2026-10-25 #### Product Innovation & Market Development Hawaii enacted a narrow cash-handling accommodation, Act 159, which from July 1, 2026 permits (without requiring) merchants to round cash transactions to the nearest five cents. The rule explicitly excludes electronic, card and instrument-based payments from its scope, meaning it applies only to transactions actually settled in physical cash. This is a product and merchant-operations-level development rather than a payments-infrastructure or licensing change: it addresses a practical friction point in cash handling (the increasing scarcity or cost of small-denomination coin) without touching electronic payment rails, card networks or digital-money products in any way. The explicit carve-out of electronic payments from the rounding permission is itself informative for market participants: it signals that the Hawaii legislature is treating physical cash as a payment instrument with distinct, isolated handling rules rather than folding cash-adjacent accommodations into the broader electronic-payments product framework. For merchants and payment-service providers operating point-of-sale systems in Hawaii that support both cash and electronic tender, the practical effect is limited to back-office cash-reconciliation practices rather than system-level product design, since no change applies to how card, account-to-account or digital-wallet transactions are processed or rounded. No other product-innovation or market-development items specific to Hawaii were identified. The broader digital-asset product developments noted elsewhere, including the kiosk cash-ban and the pending bank-custody reserve proposal, are structural and prudential rather than product-innovation items in the narrower sense of this module, and are addressed separately. #### Outlook Act 159's rounding permission is a settled, narrow accommodation with no indicated follow-on legislative activity expected. Market participants operating cash-handling point-of-sale systems in Hawaii should treat it as a completed, low-impact change rather than the start of a broader trend; no further product-innovation developments specific to this jurisdiction are currently signalled for the near term. 1 earlier distinct update(s) Periodic update · new data 2026-09-08 #### Product Innovation & Market Development SB2757 (Digital Asset Charters) is this cycle's principal product-and-market-development signal for Hawaii. The bill proposes a new state chartering framework specifically for digital-asset businesses, an instrument type Hawaii does not currently offer to any payment or crypto product category. The bill's legislative findings frame the digital-asset industry as largely unregulated in the United States, a framing that itself signals legislative intent to treat digital-asset products as a distinct market-development category warranting its own authorization pathway, separate from the state's general money-transmitter framework. This distinguishes SB2757 from the money-transmitter exemption also active this cycle: where the exemption is a licensing-relief development for existing standalone crypto activity, SB2757 is a forward-looking product-access development that would, if enacted, create an entirely new route for digital-asset business models to establish a formal state presence in Hawaii. No other product-innovation or market-development signal was identified for Hawaii this cycle. The comparative legal context, Hawaii's placement among seven US jurisdictions without a virtual-currency money-transmitter requirement, is itself a market-development-relevant data point for firms assessing where a new digital-asset product could most readily reach the Hawaii market without licensing friction, though the durability caveat that applies to the money-transmitter exemption should factor into any such assessment. #### Outlook SB2757's trajectory through the remainder of the 2026 session, and its projected 2027 Q1 impact horizon, is the primary product-development marker to watch. Enactment would give Hawaii its first dedicated digital-asset chartering product, materially expanding the state's formal market-access options beyond the current binary of exemption-or-standard-money-transmitter-license. Evidence 5 Sources and findings (5) - T1[https://governor.hawaii.gov/newsroom/dcca-release-hawaii-digital-currency-innovation-lab-to-conclude/](https://governor.hawaii.gov/newsroom/dcca-release-hawaii-digital-currency-innovation-lab-to-conclude/) - T1[https://www.htdc.org/funding/hi-cap/](https://www.htdc.org/funding/hi-cap/)retrieved 2026-07-05 - T3[https://www.boh.com/](https://www.boh.com/)retrieved 2026-07-05 - T3[https://www.pymnts.com/partnerships/2025/credit-unions-monetize-member-data-through-fintech-ties/](https://www.pymnts.com/partnerships/2025/credit-unions-monetize-member-data-through-fintech-ties/)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/hawaii-administrative-rules/](https://cca.hawaii.gov/hawaii-administrative-rules/)retrieved 2026-07-05 ### W10Consumer Protection & APP FraudConfirmedconfirmed 2026-07-05▾# Consumer protection for Hawaii payments users runs through the general HRS Chapter 480 UDAP framework, enforced by the Office of Consumer Protection, with treble-damages and attorney-fee remedies available to injured consumers. There is no Hawaii-specific authorized-push-payment (APP) fraud mandatory-reimbursement scheme; elder and crypto-scam losses reported via IC3 have risen sharply. Horizon · 2026-10-01 (± a quarter) Act 224 crypto-kiosk controls effective Adopted, not yet in force · Tier 3 source Standing sub-brief · as of 5 July 2026 103 words · last cycle 2026-09-28 #### Consumer Protection & APP Fraud Consumer protection for Hawaii payments users runs through the general HRS Chapter 480 unfair-or-deceptive-practices framework, enforced by the Office of Consumer Protection, with treble-damages and attorney-fee remedies available to injured consumers; there is no Hawaii-specific authorized-push-payment fraud mandatory-reimbursement scheme. FBI Honolulu-cited IC3 data show Hawaii elder-fraud losses nearly tripling from about $10 million to $28 million over the preceding three years, prompting credit-union-hosted public-education programming. #### Outlook Absent a dedicated APP-fraud reimbursement scheme, rising elder- and scam-related losses are likely to remain a consumer-protection gap addressed primarily through education and the general UDAP framework rather than new mandatory-reimbursement rulemaking. Read full sub-brief · 103 words Periodic update · new data 2026-09-14 #### Consumer Protection & APP Fraud Act 224 (HB1642) was enacted this session and imposes fraud-control requirements on crypto-currency kiosk operators in Hawaii, with an anticipated effective date of October 1, 2026. The Act bars kiosk operators from accepting transactions above a set daily cap per customer, mandates blockchain-analytics and fraud-tracing software to screen for transfers to wallets known or likely affiliated with fraudulent activity, and requires a forty-eight-hour hold before a new customer's first kiosk transaction can be completed. This is a probable-confidence finding, since the sole source available this cycle is a Tier-3 mirror of the enacted bill text rather than a primary session-law citation. This is squarely an authorised-push-payment and point-of-sale fraud-control measure targeting a specific, high-risk payment instrument: crypto kiosks have been a documented vector for elder-fraud and romance-scam losses because kiosk transactions, once completed, are typically irreversible. The forty-eight-hour hold on a new customer's first transaction functions as a cooling-off mechanism specifically designed to interrupt fraud schemes before the irreversible transfer completes, while the daily transaction cap limits the maximum single-day exposure of any one victim. #### Outlook Act 224's October 1, 2026 effective date is the near-term milestone to watch; confirming its exact requirements against a primary Hawaii session-law citation, rather than continuing to rely on a secondary aggregator mirror of the bill text, remains the principal sourcing gap for this development going into the next cycle. Evidence 6 Sources and findings (6) - T1[https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm](https://www.capitol.hawaii.gov/hrscurrent/vol11_ch0476-0490/hrs0480/hrs_0480-0002.htm)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/ocp/](https://cca.hawaii.gov/ocp/)retrieved 2026-07-05 - T3[https://legalclarity.org/hawaii-consumer-protection-laws-overview-and-enforcement/](https://legalclarity.org/hawaii-consumer-protection-laws-overview-and-enforcement/)retrieved 2026-07-05 - T3[https://hawaiicentral.org/fbi-on-the-bottom-line/](https://hawaiicentral.org/fbi-on-the-bottom-line/)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/dfi/news-releases/digital-currency-innovation-lab-concludes/](https://cca.hawaii.gov/dfi/news-releases/digital-currency-innovation-lab-concludes/)retrieved 2026-07-05 - T1[https://cca.hawaii.gov/ocp/](https://cca.hawaii.gov/ocp/)retrieved 2026-07-05 ### W11AML/CFT & Financial CrimeSourced from Sentinel.gi ↗Probableconfirmed 2026-07-05▾# Sentinel-fed payments-context position only: Hawaii's money-transmitter licensing regime is directly wired into the federal BSA/AML reporting perimeter via HRS 489D-16, with DFI examinations (489D-17) serving as the supervisory backbone; unregulated digital-currency activity remains expected to meet federal FinCEN/BSA obligations despite falling outside the state licensing perimeter. Standing sub-brief · as of 5 July 2026 159 words · last cycle 2026-07-05 #### AML/CFT & Financial Crime This module's intelligence is sourced from the Sentinel.gi feed rather than original WPM illicit-finance analysis. HRS 489D-16 requires every Hawaii money-transmitter licensee and its authorized delegates to file reports relating to transactions in the State as required by federal recordkeeping and reporting requirements under Title 31 U.S.C. section 5311 et seq. and 31 CFR Part 103, wiring the state licensing regime directly into the federal BSA/AML reporting perimeter. Following DCIL's 2024 conclusion, Hawaii digital-currency companies operating without a state money transmitter license remain expected to comply with federal AML and registration obligations, including FinCEN money-services-business registration, forming the de facto AML backstop for the state's unregulated-crypto carve-out; original illicit-finance risk analysis of this gap belongs with FIM, per Sentinel-fed cross-monitor routing. #### Outlook For further AML/CFT analysis of Hawaii's crypto carve-out and the illicit-finance dimension of correspondent-banking de-risking, see the Sentinel.gi feed and the Financial Integrity Monitor; this module will continue to carry payments-context provenance only. Read full sub-brief · 159 words no periodic updates on record for this sub-brief Evidence 7 Sources and findings (7) - T1sentinel.hi-489d17-examinations - T?FIM (sentinel.gi) per-JID baseline profile — United States — Hawaii — Hawaii operates under the federal BSA/AML framework (FinCEN, OFAC) plus state money-transmitter licensing via the DCCA Division of Financial Institutions. Real-estate laundering exposure is addressed through FinCEN's Honolulu/Maui/Hawaii/Kauai county Geographic Targeting Orders; the broader federal Residential Real Estate Rule was vacated by a federal court in March 2026, leaving GTOs as the primary transparency tool pending appeal. - T?FIM (sentinel.gi) gaps_register_cumulative (issue FIM-BASE-GAP-003) — Gap: sourcing-thinness - T?FIM (sentinel.gi) gaps_register_cumulative (issue FIM-BASE-GAP-002) — Gap: enforcement-absence - T2FIM (sentinel.gi) sanctions_change_register (issue FIM-BASE-SANC-003) — Sanctions: OFAC listing - T2FIM (sentinel.gi) enforcement_action_register (issue FIM-BASE-ENF-004) — Enforcement: OFAC (U.S. Department of the Treasury) — Six individuals and two entities (Amnokgang Technology Development Company, Quangvietdnbg) - T?FIM (sentinel.gi) gaps_register_cumulative (issue FIM-BASE-GAP-001) — Gap: legal-gap ### W12Correspondent Banking, Settlement & AccessConfirmedconfirmed 2026-07-05▾# Hawaii-headquartered banks (principally Bank of Hawaii) function as key U.S. correspondent nodes for the Central/Western Pacific, a role now under strain from region-wide correspondent-banking de-risking that the U.S., Australia, the Pacific Islands Forum, and the World Bank are jointly working to counteract. Standing sub-brief · as of 5 July 2026 191 words · last cycle 2026-07-05 #### Correspondent Banking, Settlement & Access The central analytical divide in this module is between bank correspondent access and non-bank settlement dependency: Bank of Hawaii Corporation functions as a key U.S. correspondent and settlement node for Guam and other Pacific Islands, a role available to it as a regulated bank that non-bank payment providers serving the same corridors cannot replicate. The company's own regulatory risk factors note that regulators weigh AML-program effectiveness when reviewing bank mergers and bank-holding-company acquisitions, tying correspondent access directly to compliance posture. The United States and Australia hosted a Pacific Banking Forum in 2024 to address the decline of correspondent banking relationships across the Pacific, convening Pacific finance ministers, central bank governors, and commercial banks; since 2011 the region has seen a 60% drop in correspondent banking relationships, prompting a US$77 million World Bank and Pacific Islands Forum remediation project. #### Outlook The bank-versus-non-bank access asymmetry that defines this module is likely to persist or widen: Hawaii-headquartered banks retain correspondent access that non-bank providers serving the same Pacific corridors lack, and the success or failure of the Treasury/Australia/World Bank remediation track will determine whether that asymmetry stabilizes or deepens. Read full sub-brief · 191 words no periodic updates on record for this sub-brief Evidence 5 Sources and findings (5) - T1[https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777](https://bankofhawaiicorporation.gcs-web.com/static-files/1e443a2c-316f-4aa3-920d-ac091d394777)retrieved 2026-07-05 - T2[https://en.wikipedia.org/wiki/Bank_of_Hawaii](https://en.wikipedia.org/wiki/Bank_of_Hawaii)retrieved 2026-07-05 - T1[https://home.treasury.gov/news/press-releases/jy2463](https://home.treasury.gov/news/press-releases/jy2463)retrieved 2026-07-05 - T1[https://www.worldbank.org/en/news/feature/2025/09/02/safeguarding-financial-lifelines-in-the-pacific](https://www.worldbank.org/en/news/feature/2025/09/02/safeguarding-financial-lifelines-in-the-pacific) Applies beyond this jurisdiction (World Bank)retrieved 2026-07-05 - T1[https://www.boh.com/](https://www.boh.com/)retrieved 2026-07-05 ### W13Commercial Intelligence (M&A, Investment & Product)Probableconfirmed 2026-07-05▾# The dominant Hawaii-relevant commercial event in the trailing 12 months is the announced acquisition by Bank of Hope (parent of Hawaii's Territorial Savings unit) of SMBC's Americas commercial banking business, expected to close in H2 2026. Hope Bancorp's earlier ~$78.6 million acquisition of Territorial Bancorp itself closed April 2, 2025, just outside this baseline's trailing-12-month collection window, and is carried instead under W6. Horizon · 2026-Q3 (± six months) Bank of Hope-SMBC Americas commercial banking acquisition expected to close Adopted, not yet in force · Tier 3 source Horizon · 2026-Q3 (± six months) Bank of Hope-SMBC Americas commercial banking acquisition expected to close Adopted, not yet in force · Tier 3 source Standing sub-brief · as of 5 July 2026 168 words · last cycle 2026-07-05 #### Commercial Intelligence (M&A, Investment & Product) Bank of Hope, parent of Hawaii's Territorial Savings unit, announced an agreement to purchase SMBC's Americas commercial banking division, comprising approximately $2.5 billion in commercial and CRE loans and $2.7 billion in deposits on a net-book-value basis; terms were not publicly disclosed. The deal is expected to close in the second half of 2026 and to be approximately 20% EPS-accretive by 2027. This is distinct from the earlier Hope Bancorp acquisition of Territorial Bancorp, which closed just outside this baseline's trailing-12-month collection window and is instead carried as industry-structure context under W6. No Hawaii-native, non-parent-company fintech or payments startup funding round was located within the trailing 12 months; this is a noted coverage gap rather than an absence of activity. #### Outlook The Bank of Hope-SMBC Americas transaction, expected to close in the second half of 2026, is the nearest dated commercial catalyst for Hawaii-linked institutions; future cycles should watch for its completion and for any Hawaii-native fintech funding activity not yet surfaced. Read full sub-brief · 168 words no periodic updates on record for this sub-brief Evidence 2 Sources and findings (2) - T2[https://www.bankingdive.com/news/bank-of-hope-buying-smbc-commercial-unit/816356/](https://www.bankingdive.com/news/bank-of-hope-buying-smbc-commercial-unit/816356/)retrieved 2026-07-05 - T2[https://www.bankingdive.com/news/hope-bancorp-completes-merger-with-hawaii-bank-territorial/744377/](https://www.bankingdive.com/news/hope-bancorp-completes-merger-with-hawaii-bank-territorial/744377/)retrieved 2026-07-05 No modules match. Filters combine as OR inside a group and AND across groups. Reset all filters ## Provenance and declared absence Disclosure model: module cards load OPEN; standing positions render in full; sub-briefs and jurisdiction briefs load as a clamped teaser with an explicit “read full” control carrying the true word count; earlier updates stay collapsed behind a counted summary. No text is hidden without disclosing how much of it there is. Sentinel-fed modules receive no special rendering treatment. sentinel_feed is an attribution chip only: it does not suppress content, does not generate an absence reason code, and does not exclude the module from any count, filter, search index or export on this page. Family taxonomy is renderer-level presentation config, not a JID field. Colour is always duplicated in text and is never the sole carrier of meaning. Suppressed by doctrine: derived risk score; per-module RAG traffic light. Not shown on this page. Band honesty: uncertainty bands are computed against a frozen build clock of 2026-10-26. A year-precision row is never promoted into a tighter band. Orphan deltas: 2 cycle_delta row(s) target non-module objects and are listed in the rail rather than attached to a card. Envelope: baseline resolved at jurisdiction_json.baseline ; 14 module(s), 74 finding(s), 146 source(s) in the cumulative register. Think something on this page is wrong? [Report an error](/legal/#contact).