Consumer Protection

Illegal Payday Lending


Since 2008, the Attorney General’s office has worked to eliminate all forms of payday lending in Arkansas. Payday lending is the practice of extending short-term loans at high annual percentage rates. It also includes so-called “installment” loans with longer terms, which carry high interest rates. Though all storefront payday loan operations in Arkansas have been shut down, these usurious loans are still available on the internet. Most online payday lenders have “roll-over” provisions that direct most, if not all, of a debtor’s payments toward loan fees without reducing the amount borrowed.

How to spot a payday loan:

  • High Interest Rate: Payday loans typically carry triple-digit interest rates or high fees, even if the fees are not called “interest.”
  • Short Terms: Typically, a payday loan is payable within two weeks to one month.
  • Direct Bank Account Access: Payday lenders usually require information about the borrower’s bank account, either through a check written to the lender or through electronic access.

What should I do?

  • Consider alternatives to payday loans. Contact creditors to request extensions on due dates. Seek the financial assistance of family or friends. Remember, a borrower typically pays more than $800 to retire a $300 payday loan. Ultimately, you will spend most of your money on interest payments.
  • If you would like to file a consumer complaint against a payday lender or a payday loan debt collector, submit an online complaint to the Consumer Protection Division or call (800) 482-8982.
  • If your loan is illegal and unenforceable under Arkansas law, our office can request that the lender or collector cancel the loan.
  • You may decide to prevent further withdrawals by closing your bank account to prevent the lender from accessing your funds. Stopping payment or closing your account will have consequences. You may be contacted by the lender or a debt collector. You could be sued. If sued, by law, our office cannot represent you.
  • Some payday lenders, or related collection agencies, use harassing and abusive collection tactics. If this happens to you, you can file a complaint with our office. Also you should be aware of your rights under the Fair Debt Collection Practices Act.
Contact Us
Sign Up For Consumer Alerts