Payday Loans and Cash Advance in Texas

Legal through credit access businesses, fees uncapped. Below: the law, the limits, what $300 costs here, who regulates it, and how to request a cash advance online in Texas.

Is a Cash Advance Legal in Texas?

Payday loans are legal in Texas and are among the most expensive in the country, because of how the law is built. Texas caps the interest a small lender can charge at 10 percent, but most payday storefronts and websites do not lend their own money. They register as credit access businesses (CABs) under Chapter 393 of the Texas Finance Code, arrange a loan from a third-party lender, and charge you a separate fee for that service. The Office of Consumer Credit Commissioner (OCCC), which licenses CABs, states plainly in its 2025 study of consumer loan products that the CAB fee is not capped, that lender interest is 10 percent or less, and that the annual percentage rate can routinely exceed 400 percent. There is no statutory cap on the loan amount either; the OCCC reports typical loans of $400 to $1,200 with terms from 3 to 180 days, due either in a single payment or in installments. Refinancing is common and adds to the cost. Several large cities, including Austin, Dallas, Houston and El Paso, have adopted local ordinances that regulate CAB loans within city limits, but outside those cities the state framework is the only limit.

The governing law is Texas Finance Code Chapter 393 (Credit Services Organizations, including credit access businesses) and Chapter 342 (Consumer Loans) (Tex. Fin. Code 393.201; 7 Tex. Admin. Code ch. 83, subch. B).

Loan Limits and Terms in Texas

Texas works in two layers. The lender behind the loan is limited to 10 percent interest, which is why it looks cheap on paper. The CAB fee is the real price, and nothing in state law caps it. The CAB collects all payments, so most borrowers never deal with the actual lender. State law limits a CAB contract to 180 days, requires a written contract that names the lender and itemizes the CAB fee, and bars prepayment penalties. Since 2012 a group of cities, starting with Austin and Dallas, have passed local CAB ordinances that require registration with the city and add limits on loan size and refinancing that do not exist statewide. If you live outside one of those cities, the only price signal is the fee schedule in your contract.

What a $300 Loan Costs in Texas

Texas does not cap the CAB fee, so this example uses the 2024 statewide average from the OCCC's CAB activity summary. Single-payment payday CABs charged $42,586,394 in fees on $102,283,336 of new extensions plus $82,420,407 of refinances, a total of $184,703,743 advanced. $42,586,394 / $184,703,743 = 0.2306, or about $23 per $100 each time a loan is made or refinanced. On $300 that is $300 x 0.2306 = $69. APR = 69 / 300 x 365 / 14 = 6.00, or about 600 percent. Your contract may be higher or lower; the fee schedule must be printed in it.

Run your own numbers with the cash advance calculator.

Consumer Protections and Who to Call in Texas

• A credit access business must be licensed by the OCCC and must give you a written, dated and signed contract before it arranges a loan (Tex. Fin. Code 393.201).
• The CAB contract must name the third-party lender, disclose the interest the lender charges, and list every fee the CAB itself charges, so the full price is on paper (Tex. Fin. Code 393.201).
• A CAB contract may not run longer than 180 days, and the contract must state that you can prepay at any time without a penalty (Tex. Fin. Code 393.201; OCCC 2025 study).
• The contract must state that the CAB cannot threaten or pursue criminal charges over a check or debit authorization that later fails, and that it must follow the Texas Debt Collection Act and the federal Fair Debt Collection Practices Act (Tex. Fin. Code 393.201).
• The contract must include the OCCC's contact information so you know where to complain, and CABs must comply with the federal Military Lending Act, which caps rates for active-duty service members and their dependents at 36 percent (Tex. Fin. Code 393.201).
• A late charge may not be assessed until 10 days after the due date and is limited to the greater of 5 percent of the payment or $7.50 (OCCC 2025 study).
• In cities with a CAB ordinance, such as Austin, Dallas, Houston and El Paso, the business must also register with the city and follow local limits on loan size and refinancing (Texas State Law Library guide).

Complaints and licence checks go to the Texas Office of Consumer Credit Commissioner (OCCC): 800-538-1579, occc.texas.gov, or file a complaint at the regulator's complaint page. The federal CFPB also takes complaints about any lender.

Online vs Storefront Lenders in Texas

An online company that arranges payday loans for Texas residents is a credit access business and needs the same OCCC license as a storefront. The OCCC notes that these loans are increasingly obtained online and that the CAB, not the lender, is the company you deal with in either channel. Two things make the online market harder to read. First, the OCCC's 2025 study reports that the number of licensed CABs has fallen 45 percent since fiscal year 2019, partly because some companies now operate only as credit services organizations under a 2019 Attorney General opinion and arrange other credit products without a CAB license or OCCC reporting. Second, out-of-state and tribal websites market to Texans without any Texas license at all. The OCCC's licensee search lets you check whether a company holds a CAB license before you give it bank details. If it does not, the state consumer protections in Chapter 393 and the OCCC complaint process are not available to you.

Alternatives If a Payday Loan Is Not the Right Fit

Texas has a regulated tier of small installment loans made directly by lenders licensed under Chapter 342 of the Finance Code, and those carry rate caps that CAB loans do not. The OCCC's 2025 comparison of a $1,500 loan puts a Chapter 342 subchapter F small installment loan at about 92 percent APR and a subchapter E installment loan at about 44 percent, against 365 to 496 percent for a CAB payday loan. Pawn loans are capped by statute as well. Beyond state-licensed products, federal credit unions offer Payday Alternative Loans, some employers advance wages, and the OCCC itself points borrowers to employer loans, credit union products and nonprofit small-dollar programs. Local assistance agencies and 2-1-1 Texas can help with utility, rent and food emergencies. If the shortfall is a single bill, asking the biller for an extension or payment plan is usually the cheapest option.

Compare the installment loan and payday alternative loan options before you decide.

Cities We Cover in Texas

• Austin, TXLocal cost of living, ordinances and help lines
• Houston, TXLocal cost of living, ordinances and help lines
• Killeen, TXLocal cost of living, ordinances and help lines
• San Antonio, TXLocal cost of living, ordinances and help lines

Frequently Asked Questions

Nearby States

• New MexicoThe fee cap, a worked example and the regulator to call in New Mexico.
• OklahomaThe fee cap, a worked example and the regulator to call in Oklahoma.
• ArkansasThe fee cap, a worked example and the regulator to call in Arkansas.
• LouisianaThe fee cap, a worked example and the regulator to call in Louisiana.