Alaska

Alaska is currently one of many states that prohibit payday loans due to their small loan interest rate caps, usury laws, and specific prohibitions for check cashers. In all there are 19 states that prohibit payday loans, 8 that permit payday loans with no small loan rate cap or usury limit, and 23 that have specific payday loan laws regulating fees etc.

Under current Alaska usury laws, banks are not allowed to charge more than 5 percent above the Twelfth Federal Reserve District discount rate. Because of this law, many banks in Alaska are turned off by the idea of providing small borrowing solutions to their customers.
Here’s one interesting point about usury laws in Alaska. If a bank charges interest that’s over the rate allowed by the state, the borrower could collect double the amount of interest they paid to the lender. Under Alaska law, the lender would be forced to pay back the borrower twice the amount of interest they collected.

Alaska laws also prohibit the act of loan splitting. Loan splitting is splitting one loan in attempt to charge two different rates. This is in violation of AS 6.20.230. However, a bank may make another loan transaction with the same customer at a further date. So long as the loan agreement does not violate statutes that prohibit loan splitting.