October 24th, 2012 by Shawn Martin
The payday loan laws in the state of Arkansas are unique and rather disheartening to the borrowers welfare. While payday loans are technically illegal in Arkansas, they are still in business and growing by the day.
Arkansas law prohibits any lender to charge more than 5 percent annually for and given loan agreement.
Since the APR of payday loans is usually around 390 to 780 percent annually, yes, you read that right, this makes payday loans illegal in this state.
Many law suites have been created out of this law and payday loan companies had to do something about this problem so the convinced the Arkansas legislature to introduce and pass the Act 1216 of 1999, the “Check-Cashers Act,” codified at ARK. CODE ANN. § 23-52-100
This simply states that these companies now have a license to do business in the state of Arkansas, and so business now goes on as usual.
May call this one of the biggest Arkansas payday loan scams of the century.
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