By State
Payday Loans in Vermont
Payday Loan Laws in Vermont (2026)
No — payday lending is illegal in Vermont. The state has no payday statute because none is needed: its lending-rate caps — 18% a year on single-payment loans and 24%/18% on installment loans — sit far below the payday model, and Vermont does not license payday lenders. So storefront and online payday loans can't legally operate.
| Status | Prohibited — no licensed payday lending |
|---|---|
| Single-payment cap | 18% per year |
| Installment cap | 24% on the first $1,000; 18% above |
| Why payday is illegal | The caps are far below payday economics; no payday licenses |
| Applies to | Storefront and online lenders alike |
| Enforcement | Department of Financial Regulation; Attorney General |
| Law | 9 V.S.A. § 41a (legal rates); 8 V.S.A. ch. 73 (licensed lenders) |
What Vermont's ban means for you
- Vermont's 18% cap on single-payment loans makes payday lending unprofitable, so no payday lenders are licensed in the state.
- Online and out-of-state lenders are not exempt. A payday loan offered to a Vermont resident still violates the rate caps.
- A loan above the legal rate may be unenforceable — get legal advice before paying interest you may not owe.
- Report an illegal lender to the Department of Financial Regulation or the Attorney General's Consumer Assistance Program.
Problem with a lender? File a complaint
Payday lending is illegal in Vermont and is enforced by the Department of Financial Regulation. To report a violation or an illegal lender, use the online complaint form.
Legal options instead of a payday loan
Legal alternatives in Vermont 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 Vermont
A lender can garnish wages in Vermont only after it sues and wins a court judgment, and federal law then caps how much can be taken. Vermont 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 Vermont Department of Financial Regulation (DFR) before borrowing. Last reviewed 2026.
Sources
Frequently asked
Are payday loans legal in Vermont?
No. Vermont's rate caps (18% on single-payment loans) make payday loans unprofitable, and the state does not license payday lenders.
Can I get a payday loan online in Vermont?
No. The rate caps apply to online and out-of-state lenders too — a payday loan offered to a Vermont resident is unlawful.
What is Vermont's interest cap on small loans?
18% a year on single-payment loans, and 24% on the first $1,000 of an installment loan (18% above).
Who do I report an illegal payday lender to in Vermont?
The Vermont Department of Financial Regulation, or the Attorney General's Consumer Assistance Program.