Payday Loan Laws by State
Last updated: July 5, 2026
Key takeaway
Key takeaway: payday loan rules are set by each state, not the federal government. Some states cap rates or ban payday loans outright, while others (like Texas) have no cap at all. This hub links every state's current rules, rate caps, and licensing so you can check yours before you borrow.
The Short Version
27 states currently allow payday-style lending under state-specific rate and term rules. 23 states plus the District of Columbia effectively prohibit high-cost payday loans, mainly through a rate cap around 36% APR — a threshold that makes traditional payday-loan pricing unprofitable to offer.
States That Allow Payday Lending
Alabama, Alaska, California, Delaware, Florida, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nevada, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming permit short-term payday lending, each with its own fee caps, loan-amount limits, and renewal restrictions. Every state name above links to a dedicated guide with full detail.
States That Restrict or Prohibit It
| State | Status | Mechanism |
|---|---|---|
| New York | Prohibited | 25% criminal usury cap |
| New Jersey | Prohibited | Low usury rate cap |
| Pennsylvania | Prohibited | 24% APR cap on licensed lenders |
| Vermont | Prohibited | Low usury rate cap |
| Massachusetts | Prohibited | Low usury rate cap |
| Arkansas | Prohibited | 17% constitutional usury cap |
| District of Columbia | Prohibited | 24% APR cap |
| New Mexico | 36% APR cap | Enacted 2023 |
| Minnesota | 36% APR cap | Effective 2024 |
| Illinois | 36% APR cap | Predatory Loan Prevention Act, 2021 |
| North Carolina | Prohibited | Banned since 2001, 36% small-loan cap |
| Arizona | Prohibited | 36% usury cap since 2010 |
| Georgia | Restricted | Bars loans under $3,000 structured as payday products |
| Connecticut | Restricted | Bans wage assignment as loan security |
| West Virginia | Prohibited | No deferred-presentment loans permitted |
| Colorado | 36% APR cap | Voter-approved, 2018 |
| Montana | 36% APR cap | Voter-approved usury law |
| Nebraska | 36% APR cap | Initiative 428, 2020 |
| New Hampshire | 36% APR cap | Since 2009 |
| South Dakota | 36% APR cap | Initiated Measure 21, 2016 |
| Hawaii | Prohibited | Act 56 banned traditional payday loans, 2022 |
| Maine | 30% APR cap | Small loan rate cap |
| South Carolina | Prohibited | Deferred Presentment Services Act repealed, effective Jan. 2026 |
| Maryland | Prohibited | 33% usury cap on consumer loans |
That's 23 states plus DC in the "effectively prohibited" category, each with its own documented mechanism above. For the complete 51-jurisdiction breakdown and primary statutes, see NCSL's payday lending state statutes page, the authoritative source for this data.
Why This Matters When You Apply
US Lending only routes applications to lenders licensed in the state you live in. If your state caps rates near 36% APR, you won't be matched with a traditional payday product — but personal installment loans, credit-builder loans, or debt-relief options may still be available through our network.
Payday Loan Laws by State: Common Questions
How many states allow payday loans?
27 states currently allow payday-style lending under state-specific rate and term rules. 23 states plus the District of Columbia effectively prohibit high-cost payday loans, mainly through a rate cap around 36% APR.
What rate cap effectively bans payday loans?
A rate cap around 36% APR. That threshold makes traditional payday-loan pricing unprofitable to offer, so lenders stop making those loans in states that impose it.
Can I still get a loan if my state prohibits payday lending?
Possibly. US Lending only routes applications to lenders licensed in your state. If payday products are capped out where you live, personal installment loans, credit-builder loans, or debt-relief options may still be available through the network.
Where does this state payday-law data come from?
The National Conference of State Legislatures (NCSL), the authoritative source for state payday statutes. Laws change frequently, so always confirm the current rules for your state before assuming a product is or isn't available.
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