State lending rules
Montana Payday & Small-Dollar Loan Laws
36% APR cap (Initiative 164)
Montana voters capped payday loans at 36% APR via Initiative 164 in 2010, effectively ending storefront payday lending.
Maximum loan amount
$300
Maximum term
31 days max
APR / finance charge
36% APR (all-in)
Rollover rule
No rollovers permitted
Cooling-off period
None required
Statute
Mont. Code Ann. § 31-1-701
Montana lending overview
Montana state law establishes a 36% annual percentage rate cap on short-term loans. This limit, enacted by voters through Initiative 164 in 2010, includes all interest and fees charged to the borrower. Under these regulations, the maximum amount for a payday loan is $300 with a repayment period no longer than 31 days. Because these stringent interest rate controls make traditional high-cost storefront lending unprofitable, the availability of conventional payday products remains limited compared to states without such caps.
Residents seeking immediate funds typically evaluate various credit products that comply with the state's interest rate ceiling. Common options include installment loans, personal loans from credit unions, and small-dollar emergency advances through online platforms or local banks. These lending structures allow for longer repayment terms and predictable monthly payments. Borrowers often use these financial tools to cover unexpected medical bills, car repairs, or temporary cash flow gaps while remaining within the legal protections provided by Montana's consumer lending statutes.
What the law means for borrowers
Montana's rules affect whether payday loans are available, how much a borrower may be able to receive, how long repayment can last, and what finance charges may apply. Even where payday lending is legal, the total repayment amount can be substantially higher than the amount borrowed.
Before accepting a loan offer
- Confirm the lender is licensed or otherwise authorized to operate in Montana.
- Compare APR, fees, payment schedule, and total repayment amount.
- Check whether rollovers, renewals, or refinancing are allowed or restricted.
- Consider lower-cost alternatives such as credit-union small-dollar loans, payment plans, employer advances, or local assistance programs.
Who regulates lenders in Montana
Montana Division of Banking & Financial Institutions
File a complaint with the regulator above if a lender violates state law. You can also file with the CFPB.
Loan options in Montana
Compare state-specific loan pages before applying. Product availability depends on state law, lender licensing, underwriting, and your financial profile.
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Also useful: APR calculator · Compare loan types · State loan laws
Other state loan laws
Reviewed by Darnell Pierce, MBA. Last reviewed January 2026. This page is informational and is not legal advice. Verify current rules with the state regulator before borrowing.