Payday lending is prohibited in Washington, DC.
District of Columbia Legislature put a stop to payday lending practices in the state first in 1998 when it banned check cashers from issuing post-dated checks and next in 2007 when it eventually put a 24% APR cap on small loans. Currently, there are no payday lenders in the state.
Washington, DC Payday Lending Statutes
Washington, DC has two laws that restrict payday lending: amended D.C. Code Ann.28-3301(a):
“(a) Except as otherwise provided in this section, section 28-3308, and chapter 36 of this subtitle, the parties to an instrument in writing for the payment of money at a future time may contract therein for the payment of interest on the principal amount thereof at a rate not exceeding 24% per annum.”
“(b) No licensee shall at any time cash or advance any monies on a post-dated check.”
Rates, Fees and Other Charges in Washington, DC
There is a small loan cap of 24% APR. (D.C. Code Ann.28-3301(a))
More information about small loan laws and regulations in Washington, DC can be found on the official website of the D. C. Department of Insurance, Securities and Banking.
Regulator: Complaints & Information
D.C. Department of Insurance, Securities and Banking
Address: 1050 First St NE #801, Washington, DC 20002
File a Complaint: https://disb.dc.gov/service/file-complaint-or-report-fraud
The History of Payday Loans in Washington, DC
- 1998 – The Check Cashing Act stopped the practice of issuing post-dated checks in D.C. However, people went on borr
owing in the same manner from check cashers. Rates were sky-high, debts grew.
- 2007 – Washington, DC banned payday loans in the state. As a matter of fact, the Consumer Protection Amendment Act of 2007 was enacted. It capped small cash loans at 24% APR and removed everything related to payday loans from the Check Cashing Act of 1998.
- Present days – Payday loans are currently illegal in DC.
[Updated As of February 2020]