Implications of Initiated Measure 21 in South Dakota

Information verified correct on May 10th, 2017

It was a hot topic in South Dakota, which showed claws on both sides.

The initiated measure of 21 put a 36% interest rate limit, putting an end to astronomical rates, which, according to supporters, took advantage of the financially vulnerable.

“All of the payday lenders moved out of the state. They left us. They left. They no longer infect our community, “said Steve Hildebrand, a supporter of the IM 21.

After IM21 passed – one after another, short-term creditors closed their doors. With the disappearance of storefronts, Hildebrand says that the temptation is more not just before the vulnerable when they pass by.

“They are looking for other ways to do this – get a second job, look for any alternative, just to not borrow money for 574%,” said Hildebrand.

Today in Sioux Falls closed more than 50 payday lending stores. But while these payday lenders can no longer work with an interest rate higher than 36% in South Dakota, they still exist outside of our state.

“They can be Internet services outside of South Dakota that South Dakota residents still use, and we just hope that people will stay away from these operations. In most cases, they are bad companies that try to take advantage of unsuspecting people, vulnerable people and people should simply avoid it. Never go online and do not borrow money from the payday lenders, because you will regret it for the rest of your life, “said Hildebrand.

“There are still many ways to get money,” said Breck Miller, coordinator of public relations at the Lutheran Social Services Center for Financial Resources.

Miller worries that people are still turning to the Internet. In a simple Google search, there are payday loans and short-term loans.

“In some respects, it’s much easier now, because people are more online-oriented – what they can do from home, instead of going to brick and mortar sites,” Miller said.

Nevertheless, Miller thinks that passing the IM21 opens the door for a more detailed discussion of financial responsibility.

“We try to send them then, instead of just finding these short term benefits, let’s look at other options. Let’s try to find out where your money is going and what we can change to make it more sustainable than going on short-term loans, “Miller said.

Miller says that at first it can be too difficult, but requires discipline. But he says that you can change your life.

“Although this is easier and can cover you in the short term, look at the big picture: what can we fix, what can we do to ensure that we do not have to go back and continue paying any interest rate for short-term loans,” Miller said.

“Take money from someone other than a payday lender,” Hildebrand said.

Miller says, do not be afraid to ask for help. There are resources to appeal to the credit union, the Lutheran Social Service and the Minneshah County Humanitarian Services.

Phil Kirsten

As a writer for, Phil Kirsten specializes in personal finance, with her passion centring on helping people find better for whatever they're looking for.

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