With the tightening of lending regulations came the spawn of new business in the alternative financial services space -- which includes payday lenders, auto title lenders, and pawn shops. Payday lending has been especially profitable in South Dakota, which sanctions advances of $500 or less, with no restriction on interest rates. The short-term loans could carry an annual percentage rate of more than 500 percent. State Rep. Steve Hickey (R-Sioux Falls) penned legislation in 2011 to cap interest rates at 36 percent; and although the bill never left committee, he hopes to take his campaign public to ban no-cap usury laws. “Payday loans that can flourish under a state that has no usury limits need to be banned the right way,” he said. “It’s a subject that needs to go to the voters like it did in Montana, where it is now illegal.” Some of the largest U.S. banks, blocked from lending to people with credit scores of less than 650, are entering the fast-cash loan market. The consumer group National People’s Action reported that national banks financed 42 percent of the payday loan industry nationwide. Some banks market their own form of deposit-advance products, such as Wells Fargo’s direct-deposit advance that charges $1.50 for every $20 that customers borrow against their paychecks. In April, the Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency proposed standards that would limit banks’ use of such products.