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Payday Loans in South Dakota
Payday Loan Laws in South Dakota (2026)
High-cost payday loans are gone in South Dakota. In 2016, about 76% of voters passed Initiated Measure 21, capping the all-in APR on consumer loans at 36%. Because that ceiling counts every fee and charge, the payday model collapsed — more than 120 lenders surrendered their licenses — and a loan above the cap is now void and uncollectable.
| Status | Legal in name, but capped at 36% APR — payday ended |
|---|---|
| APR cap | 36%, all-inclusive (interest + all fees), Initiated Measure 21 (2016) |
| Voter approval | About 76% in 2016 |
| Loans above the cap | Void and uncollectable; violation is a misdemeanor |
| Effect | 120+ lenders surrendered licenses; payday lending ended |
| Regulator | South Dakota Division of Banking |
| Law | Initiated Measure 21 (2016); SDCL ch. 54-4 |
What South Dakota's 36% cap means for you
- South Dakota voters approved the 36% cap by about 76% in 2016 — one of the most lopsided payday votes anywhere.
- The cap is all-inclusive: interest plus every fee and charge must fit within 36% APR, so lenders can't layer on extra costs.
- A loan that exceeds the cap is void and uncollectable, and making one is a misdemeanor.
- Within a year, more than 120 licensed lenders gave up their licenses — storefront payday lending effectively ended.
Problem with a lender? File a complaint
Consumer lending in South Dakota is overseen by the Division of Banking. To report a violation or an illegal lender, use the online complaint form.
Alternatives to a payday loan
With the 36% cap, look to a credit-union small loan or payday-alternative loan, an employer paycheck advance, or nonprofit credit counseling. See our guide to payday loans and alternatives.
Your debt rights in South Dakota
A lender can garnish wages in South Dakota only after it sues and wins a court judgment, and federal law then caps how much can be taken. South Dakota 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 South Dakota Division of Banking before borrowing. Last reviewed 2026.
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Frequently asked
Are payday loans legal in South Dakota?
They are legal in name, but a 2016 voter-approved 36% all-in APR cap (Initiated Measure 21) ended the high-cost payday industry.
What is South Dakota's payday loan interest cap?
36% APR, all-inclusive — interest plus every fee and charge must fit within that rate.
What happens to a loan above the cap in South Dakota?
It is void and uncollectable, and making such a loan is a misdemeanor.
Can I still get a payday loan in South Dakota?
In practice, no. The 36% cap drove payday lenders out of the state; look to lower-cost alternatives instead.
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