Am I allowed to take a payday loan in Denmark?
Yes — but a consumer or payday loan is tightly regulated after the 2020 reform. There is an interest cap, so the annual cost (ÅOP) may be at most 35% when the loan is taken, and a cost cap, so total costs may not exceed 100% of the loan amount — you never repay more than double the borrowed amount in costs. Agreements above the caps cannot lawfully be concluded, so an offer above them is not merely expensive: it must not be made at all. It is forbidden to advertise credit with an annual cost of 25% or more, and forbidden to market loans in connection with gambling. The lender must hold a licence, and you have a 14-day cooling-off right on the loan agreement.
📋 The rules
- The annual cost may be at most 35% (interest cap)
- Total costs at most 100% of the loan
- Forbidden to advertise credit with an annual cost of 25% or more
- Forbidden to market loans in connection with gambling
- The lender must hold a licence
🔓 Exceptions
- Mortgage loans are exempt from the rules
- Credit purchase of a specific good or service is exempt from the gambling ban
- You have a 14-day cooling-off right on the loan agreement itself
⚠️ Penalties & fines
Breaches are punished with fines, and fines of up to 1 million kr have been given for misleading marketing of loans. Harder still, a firm can lose its licence — and without a licence it may not run a consumer lending business at all, which is the sanction that actually closes the shop. For you as a borrower, the key point is that agreements above the caps cannot lawfully be concluded: an offer with an annual cost above 35%, or costs exceeding 100% of the loan, is not merely expensive — it must not be made.
📎 Official sources
- Consumer Ombudsman · Credit cost cap →
- Consumer Ombudsman · Marketing loans at gambling →
- L 149 Payday loan reform · Retsinformation →
❓ Frequently asked
Can I take a payday loan?
Yes, but it is tightly regulated after the 2020 reform. The annual cost may be at most 35% when the loan is taken, and the total costs may not exceed 100% of the loan amount, however long the loan runs.
What is the interest cap?
A cap so the annual cost in percent (ÅOP) may be at most 35% when the loan is taken. Agreements above the cap cannot lawfully be concluded, so an offer above 35% is not merely expensive — it must not be made.
What is the cost cap?
Total costs may not exceed 100% of the loan amount, so you never repay more than double the borrowed sum in costs. Mortgage loans are exempt from both the interest cap and the cost cap.
Can firms advertise payday loans?
Not credit with an annual cost of 25% or more, and not in connection with gambling. Fines of up to 1 million kr have been given for misleading marketing, and a firm can also lose its licence.
Do I have a cooling-off right on a loan?
Yes, 14 days on the loan agreement itself. On withdrawal you repay the principal plus interest within 30 days, and the lender must in any case hold a licence to offer the loan at all.
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