By State
Payday Loans in Connecticut
Payday Loan Laws in Connecticut (2026)
No — payday lending is effectively illegal in Connecticut. The Small Loan Act caps the all-in APR on small loans at 36% (and 25% on larger ones), far below the payday model, and Connecticut does not license payday lenders. A 2023 amendment broadened the cap to count all fees using the federal Military Lending Act method, closing fee-based workarounds.
| Status | Prohibited — no licensed payday lending |
|---|---|
| Small-loan APR cap | 36% on loans under $5,000; 25% on $5,000–$50,000 |
| How APR is measured | All-in, including all fees (Military Lending Act method, since 2023) |
| Why payday is illegal | The cap is far below payday economics; no payday licenses |
| Applies to | Storefront and online lenders alike |
| Enforcement | Connecticut Department of Banking |
| Law | Connecticut Small Loan Act (Conn. Gen. Stat. § 36a-555+, amended 2023) |
What Connecticut's ban means for you
- Connecticut's 36% all-in APR cap makes payday lending unprofitable, so no payday lenders are licensed in the state.
- A 2023 amendment counts every fee in the APR (the Military Lending Act method), so lenders can't dodge the cap with add-on charges.
- Online and out-of-state lenders are not exempt. A payday loan offered to a Connecticut resident still violates the cap.
- Report an illegal lender to the Connecticut Department of Banking.
Problem with a lender? File a complaint
Payday lending is illegal in Connecticut and is enforced by the Department of Banking. To report a violation or an illegal lender, use the online complaint form.
Legal options instead of a payday loan
Legal alternatives in Connecticut include a payday-alternative loan from a credit union, an employer paycheck advance, nonprofit credit counseling, or a payment plan with the biller. See our guide to payday loans and alternatives.
Your debt rights in Connecticut
A lender can garnish wages in Connecticut only after it sues and wins a court judgment, and federal law then caps how much can be taken. Connecticut does not run a statewide payday-loan database, so limits on how many loans you can hold are harder to track from lender to lender. Your rights when you cannot repay are set by a mix of federal and state law — these guides explain how they work:
- Can a payday lender sue you?
- Can payday loans garnish your wages?
- Do payday loans affect your credit?
- Payday loan statute of limitations
- How many payday loans can you have?
- How to get out of payday loan debt
Disclaimer: general information, not legal or financial advice. Laws change — verify the current rules with the Connecticut Department of Banking before borrowing. Last reviewed 2026.
Sources
Frequently asked
Are payday loans legal in Connecticut?
No. The Small Loan Act caps the all-in APR at 36%, which makes payday loans unprofitable, and the state does not license payday lenders.
Can I get a payday loan online in Connecticut?
No. The cap applies to online and out-of-state lenders too — a payday loan offered to a Connecticut resident is unlawful.
What is Connecticut's interest cap on small loans?
36% all-in APR on loans under $5,000 (25% on $5,000–$50,000), counting all fees since a 2023 amendment.
Who do I report an illegal payday lender to in Connecticut?
The Connecticut Department of Banking.