Payday lending is prohibited in the Virgin Islands.
In the Virgin Islands, the Payday Lending State Statutes page on the National Conference of State Legislature reads: “Virgin Islands – Not available“. All lending is governed by state laws, there are no specific payday lending statutes, the practice is not authorized in the state.
Virgin Islands Payday Lending Statutes
In the state, lending is generally governed by TITLE NINE Banking, and Subchapter I. Small Loans specifically regulates the rates of interest that can be charged for small personal loans in the Virgin Islands.
According to the V.I. Code Ann. Tit. 9§182 et seq., lenders cannot charge more than 26% of interest:
In the Virgin Islands, never can the annual percentage rate on interest be lower than 19.5% and no more than 26% per year. The rate must be the genuine percentage interest rate based on formulas outlined in Virgin Island law at the time of the loan signing.
Any out-of-state or online lenders have to comply with a 26% APR cap as well:
In the case of loans issued outside of the Virgin Islands, they are required to conform to the laws of the governing agency of that place. For loans made within the Virgin Islands after July 1st of 1968, they are able to be collected within the Virgin Islands by a licensed lender, though charges are not to exceed any outlined in Virgin Island law.
According to the Virgin Islands’ code, it is compulsory that all the lenders adhere to the aforementioned regulations, and, any lenders charging differently are considered to be operating illegally.
More information about the Virgin Islands and the state’s laws can be found on the official website of the Office of the Lieutenant Governor in the United States Virgin Islands.
The History of Payday Loans in the Virgin Islands
- 2000 – The V.I. Code Ann. Tit. 9§182 et seq. read that all small lenders cannot charge more than 26% APR.
- Present days – Payday loans are currently illegal in the Virgin Islands.
[Updated As of February 2020]