What a payday loan costs — before Ohio’s rules
A payday loan typically costs $15–$20 per $100 borrowed for a two-week term — roughly 400% APR — and is due as a single lump sum on your next payday. That single-payment structure, not the fee on any one loan, is the trap: most fees come from borrowers who cannot clear the balance in one go and roll it over. Where a state caps rates below payday levels, licensed payday lending disappears and a loan above the cap is generally void — not legally collectible, whatever the contract says.
The law in Ohio
- Rate cap
- The Short-Term Loan Act, as amended by the 2018 Fairness in Lending Act, caps interest at 28% APR (plus limited fees), ORC § 1321.35+.
- Key law
- Ohio Fairness in Lending Act, 2018 (amending the Short-Term Loan Act).
- Enforcement
- The Ohio Division of Financial Institutions licenses short-term lenders; the 2018 law closed loopholes that had let lenders avoid the original 2008 Short-Term Loan Act.
From 2008 to 2018 no lender took a license under Ohio’s original Short-Term Loan Law, prompting the 2018 Fairness in Lending Act and its 28% APR cap.
What it means for a Ohio borrower
Storefront and much online high-cost lending was pushed out or restructured, and many online and tribal lenders stopped lending to Ohio residents. Tribal loans above the 28% cap are on weak legal footing.
If you already have a payday loan in Ohio
A loan that violates Ohio’s rate limits may be partly or fully unenforceable — which changes your options with the lender and any collector. This is general information, not legal advice.
- File a complaint with the Ohio Department of Commerce, Division of Financial Institutions, and the Ohio Attorney General.
- Check whether the lender is licensed under the Short-Term Loan Law — unlicensed loans above 28% APR may be challengeable.
Cheaper first — try these before a payday loan in Ohio
Payday Loans and tribal lenders in Ohio
Many online lenders that market payday loans to Ohio residents are tribal lenders arguing their sovereignty places them outside state rate caps — a separate legal question this site tracks in depth. For which tribal brands lend to Ohio residents and how state law applies to them, see the Ohio tribal-lending page.
Tribal loans in Ohio →Frequently asked questions
Are payday loans legal in Ohio?
In Ohio, payday loans are legal but tightly limited. The state caps loan size, fees or rollovers, so a legal payday loan looks different — and costs less — than the ~400% APR norm, and any lender exceeding those limits is out of compliance.
What is the maximum payday loan rate in Ohio?
The Short-Term Loan Act, as amended by the 2018 Fairness in Lending Act, caps interest at 28% APR (plus limited fees), ORC § 1321.35+.
What can I do about a payday loan I already have in Ohio?
Because Ohio restricts high-cost payday loans, a loan that exceeds the state limit may be partly or fully uncollectible. File a complaint with the Ohio Department of Commerce, Division of Financial Institutions, and the Ohio Attorney General. This is general information, not legal advice.