Payday Loans in Arkansas: Ruled Out by a 17% Constitutional Cap
Page last reviewed: October 28, 2026 · Reviewed for accuracy by Betty Walsh
No. Payday loans aren't legal in Arkansas: Amendment 89 to the state constitution caps interest at 17% a year on loans other than those from Arkansas-based banks, and a loan above that is void as to principal and interest.
| Payday loans | Not legal A non-bank loan above 17% a year is void |
| Rate cap | 17% a year on loans not made by Arkansas-based banks |
| Example | $1,000 over 12 months: about $91.20 a month at 17% |
| Banks | Arkansas-based banks may use a federal rate under Section 2 |
| You need | ID, proof of income and a bank account |
Monthly Payments on Arkansas Loans at 17%
| Loan | Payments | Interest |
|---|---|---|
| $300, 6 mo | 6 × $52.51 | $15.06 |
| $500, 6 mo | 6 × $87.51 | $25.06 |
| $1,000, 12 mo | 12 × $91.20 | $94.40 |
| $3,000, 24 mo | 24 × $148.33 | $559.92 |
| $5,000, 36 mo | 36 × $178.26 | $1,417.36 |
Worked out from Arkansas's 17% constitutional cap, not offers from lenders in our network; a lender can charge less.
Compare the Attorney General's warning: a borrower typically pays more than $800 to retire a $300 payday loan. At 17% a year over six months, the same $300 costs $15.06 in interest.
Amendment 89 in Plain English
- Section 3: loans and contracts other than government loans and loans by Arkansas-based federally insured banks can't carry more than 17% a year.
- Section 6(b): a Section 3 contract above the cap is void as to principal and interest.
- Section 2: a federally insured bank with its main office in Arkansas can charge the rate federal law allowed such banks on March 1, 2009.
- Section 6(a): the amendment doesn't override federal law on loans or interest rates.
So outside the banks covered by Section 2 or by federal law, a lender charging more than 17% a year has no enforceable loan, whether it lends from a store or online.
Payday Loans Online: What the Attorney General Says
The Attorney General's office has worked since 2008 to end payday lending in Arkansas. Every storefront payday operation has closed, but the office warns that these usurious loans are still offered online, often with roll-over terms that send most payments to fees.
- How to spot one. Triple-digit rates or high fees, a term of two weeks to a month, and a demand for access to your bank account.
- Ask for cancellation. If a loan is illegal and unenforceable under Arkansas law, the office can ask the lender or collector to cancel it.
- Think before closing your account. Stopping payment can bring collection calls or a lawsuit, and the office can't represent you if you're sued.
When a Bank Makes the Loan
Banks lend under their own rules. A federally insured bank with its main office in Arkansas can charge the rate federal law allowed on March 1, 2009, and Amendment 89 leaves federal law on other banks' rates in place, so a bank's offer can carry more than 17%. Look the bank up in FDIC BankFind and compare the APR on its disclosure.
Asking for an Arkansas Loan Within the Cap
- Decide how much you need and how long you need to repay it; at 17%, a longer term lowers the payment but adds interest.
- Submit one request through LendUp. Lenders in our network review it, and any offer shows the APR, payments and total cost before you sign.
- Check the interest rate: above 17% a year, the lender should be a bank you can find in FDIC BankFind.
Reporting a Lender That Charges Over 17%
- Read the interest rate on the offer. From a lender that isn't a bank, anything above 17% a year breaks Amendment 89.
- If the lender says it's a bank, look it up in FDIC BankFind.
- File a complaint with the Attorney General's Consumer Protection Division online, and keep copies of the loan documents.
You can also call the Consumer Protection Division at (800) 482-8982 or (501) 682-2007.
Common Questions
Are payday loans allowed in Arkansas?
No. The constitution caps interest at 17% a year on loans from lenders other than Arkansas-based banks, and contracts above it are void. The Attorney General says every storefront payday operation has shut down.
Who will give me a loan when nobody else will in Arkansas?
No lender has to say yes; each sets its own standards. Within the 17% cap you can request an installment loan, and banks lend under their own rules. Be wary of online payday offers: the Attorney General says they're still marketed to Arkansans.
How much does a $1,000 loan cost in Arkansas?
At the 17% cap over 12 months, about $91.20 a month, or $94.40 in interest. A lender can charge less.
What if I already have an online payday loan?
File a complaint with the Attorney General. If the loan is illegal and unenforceable under Arkansas law, the office can ask the lender or collector to cancel it.
Do banks have to follow the 17% cap?
Not all of them. A federally insured bank with its main office in Arkansas can charge the rate federal law allowed on March 1, 2009, and Amendment 89 doesn't override federal law on other banks.
How do I report an illegal lender in Arkansas?
Use the Attorney General's online consumer complaint form, or call (800) 482-8982 or (501) 682-2007.
Official Sources
General information, not legal advice. Facts on this page were checked against these sources on October 28, 2026.
LendUp isn't a lender. We pass your request to lenders in our network; offers aren't guaranteed, and we may earn compensation if a loan is funded.