South Dakota Payday Loan Laws

By | Feb 10, 2011

South Dakota Payday Loan Law Stopped Cold

A South Dakota House committee rejected a proposal to impose a maximum fee of 36% APR and increase South Dakota payday loan licensing fees to $5000.

A Republican –  no less, Rep. Steve Hickey of Sioux Falls, sponsored two bills aimed at payday loan lenders.

Luckily for residents of South Dakota, the legislators understand that many payday loan consumers have no other choice. Banks don’t make small, non-collateralized loans and credit card companies are reducing available credit to the payday loan demographic.  See: What’s ALICE Got to Do With Payday Loan Demographics.

South Dakota Rep. Steve Hickey would not only deprive his constituents of choices in solving their financial challenges, but additionally, put more companies, employees and landlords out of business!

South Dakota payday loan lenders clearly display, in large fonts, their fees, charges and sample APR’s.

South Dakota residents freely choose to use the payday loan product. If they don’t think a payday loan makes sense for them, they’ll stop using them… and payday loans will go the way of the buggy whip!

Get out of the way Rep. Hickey. Let private enterprise create more, higher paying jobs. That will reduce the number of South Dakota residents who need to turn to payday loans in the first place. I bet with fewer customers, South Dakota payday loan companies will be forced to reduce their rates or leave the state.

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3 Comments so far
  1. Paul Robinson April 7, 2011 6:59 pm

    Instead of trying to find ways of limiting people’s ability to get payday loans, why don’t they pass some legislation that forces banks to offer people second-chance short term loans at reasonable rates? That would be a positive way to deal with the problem.

  2. jim hollis September 23, 2011 10:21 pm

    With the current economic situation, banks are not making loans to many people, including those with low income or “bad” credit – the credit market is basically ANYONE with a lower than 650 credit score is HIGH risk, compared to before 2002 a credit score of 550 was considered average and loans were available. HOWEVER, so called “payday” loans in S.D. ALLOW ‘PREDATORY LENDING” in that a person who cannot get a loan elsewhere has to pay anywhere from 2 to 4 times the amount borrowed to receive a loan. These agencies DO NOT follow the limitations of ANY law and specifically target low income people so they can NEVER pay off the initial loan. These folks have been paying for 6 months on an initial loan of $100.00 and by that time have paid some $420.00 in interest and fees and have NEVER been able to pay the original loan of $100.00 . NOW, If I borrow $5.00 from YOU today(Friday), and pay it back when I get my check (in 5 days on Wednesday), is it REASONABLE for me to pay you $19.00, when I only needed gas money for a few days?
    That is what these people do. They PREY on people who are barely able to put food on the table and causing them HUGE expenses that they could be feeding their family with and then these Lenders claim that they have expenses that justify charging more than 3 times what a person borrows.

    In the old days that was called “LOAN SHARKING” and was OUTLAWED in EVERY State and in EVERY United Nations Country in the World in 1994.

    What else needs to be said. No Country , nor ANY State, is supposed to allow this kind of lending practice. Why do you think that banking and financial markets COLLAPSED?

  3. karl January 25, 2013 4:22 am

    I wrote to rep. noem and told her how immoral these practices are and how they prey on the desperate. Someone called my cell and wanted to hear my personal issue. I see she has no problem with these lending interest rates as long as she does not get charged the same. I got the runaround and see she will not act to limit these once illegal practices. At least, about ten states are proud enough to stop this exploitation.

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