The 33% Usury Cap
In 2002, Maryland lawmakers capped small consumer loans at 33% APR — for loans of $2,000 or less, that breaks down to 2.75% per month on the first $1,000 and 2% per month above that; loans over $2,000 are capped at 2% per month across the whole balance. That ceiling has made traditional payday lending unprofitable in the state ever since.
The App-Based Lending Wrinkle
A 2025 bill (HB 1294) briefly exempted app-based payday lenders — earned-wage-access and cash-advance apps — from Maryland's small-dollar lending law entirely. Governor Wes Moore signed follow-up legislation (SB 94) that restored some protections, requiring these apps to comply with the law's bans on discriminatory lending and unfair or deceptive practices, even though the 33% rate cap exemption for these apps was not fully reversed.
What This Means for Borrowers
Traditional storefront and online payday lenders remain effectively locked out of Maryland by the 33% cap. App-based cash-advance products occupy a more complicated legal space after the 2025-2026 legislative back-and-forth — worth reading the terms carefully if you're considering one, since the underlying protections have shifted more than once recently.
| Factor | Maryland Rule |
|---|---|
| Usury cap | 33% APR (2.75%/2% monthly tiers) |
| Cap in effect since | 2002 |
| App-based lenders | Partially exempted from rate cap; other protections restored via SB 94 (2025-2026) |
| Traditional payday loans | Effectively prohibited |
Given the recent legislative activity, Maryland borrowers are better served by licensed personal-loan products priced within the 33% cap than by any product marketed as a payday advance.
Compare Maryland lender offers — free, no obligation.
Start Your Free Match →