North Carolina Payday Loan Law and Legislation

North Carolina Payday Loan Regulations
Legal Status
Interest Rate (APR)
36% APR small loan cap

Payday lending is prohibited in North Carolina.

In North Carolina, payday lending is considered illegal. The state was the first to ban the industry in 2001, and the situation has remained the same for years. State laws impose small loan cap of 36% APR on small-dollar loans.

North Carolina Payday Lending Statutes

In the state of North Carolina, payday loans are prohibited in accordance with the North Carolina Consumer Finance Act (N.C. Gen. Stat. 53-173).

The ban has been in action since 2001, and, all in all, the state has got the most severe laws in regard to payday lending. Moreover, recently, there have been made a lot of amendments that made it difficult for payday lenders to find any loopholes and continue their activity.

In fact, almost all the companies that worked in the field have ceased operation entirely; or they got a license and are obliged to comply with the state laws and follow the required small loan interest cap of 36% APR.

Rates, Fees and Other Charges in North Carolina

  • In North Carolina, according to the state code, any lending businesses offering either short-term cash advances or any loans are forbidden to charge more than 36% per annum as APR.
  • Any lender charging more is considered violating the law.

Consumer Information

More information about payday loan laws and regulations in North Carolina can be found on the official website of the Office of the Attorney General Consumer Protection Unit.

Regulator: Complaints & Information

North Carolina Attorney General

Address: NC Attorney General’s Office, 114 W Edenton St, Raleigh, NC 27603
Phone: 919-716-6400
Fax: 919-716-6750
File a Complaint:

Number of North Carolina Consumers Complaints by Topics

According to CFPB Consumer Complaint Database

  • Charges from account ( 124 )
  • Fraud and threat ( 101 )
  • Not exiting debt ( 68 )
  • Loan to return ( 30 )
  • Not requested loan ( 21 )
  • Loan not received ( 20 )
  • Lender is not available ( 16 )
  • Credit rating ( 13 )

The History of Payday Loans in North Carolina

  • 1997 – The first legislation that concerned payday lending was passed.
  • 1999 – Payday lending was legal in the state. It was allowed to be so till 2001 (until “sunset”).
  • 2001 – Payday loan law expired. North Carolina Legislature took into consideration the predatory nature of such loans and their threat to small incomes and decided to put a stop to the industry. The General Assembly passed a law that banned all payday loan businesses in the state. In fact, North Carolina was the first state in the country that made payday lending illegal. “There have been no payday loans available in North Carolina since 2006, ” the Charlotte Post reported in 2016.
  • However, it took time to get rid of all the illegal lenders that operated in the state. The greatest improvement in the situation happened when a lot of them were held liable and convicted for the harassing actions towards borrowers.
  • 2015 – Online lenders were a great problem as their operations were technically legal. However, the North Carolina Business Court banned several companies from operating in the state, canceled existing loans, and took other legal measures.
  • 2018 – There was an attempt to pass the bill that would allow payday lending but with the condition of the present small loan cap. However, it was unsuccessful.
  • Present days – As of 2019, by law payday loans remain prohibited in the state of North Carolina.

[Updated As of February 2020]

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