Reference · South Dakota · 2026
South Dakota late payment interest rate
When your contract sets no rate, the South Dakota figure for interest on an overdue B2B invoice is ≤ 12% (Category C), under SDCL § 54-3-4 → § 54-3-16.
Where an obligation to pay interest names no rate, interest runs from the debt's incurrence at up to the Category C rate (12%).
- Rate
- ≤ 12% (Category C)
- Statute
- SDCL § 54-3-4 → § 54-3-16
- Type
- Fixed by statute.
- Source
- sdlegislature.gov · verified July 9, 2026
Work out the interest on your invoice
Prefilled with South Dakota's 12% ceiling — a court may award less.
Interest you can claim
$197.26
$10,197.26 with the invoice · $3.29 a day
The ceiling
How high can a late fee go in South Dakota?
Your contract decides. The rate above only applies when your terms are silent. Between businesses, an agreed late-interest rate or late fee replaces it, within two limits: the state's ceiling on agreed rates, and the rule that a late fee must compensate you rather than punish the customer.
South Dakota's ceiling on an agreed rate wasn't part of our verified research, so check the state's usury law, or ask a lawyer licensed in South Dakota, before writing the common 1.5%-a-month (18%) rate into your terms.
Late payment wording for a South Dakota invoice
On your invoice
Payment is due by the date shown on this invoice. We reserve the right to claim interest on any amount not paid when due, as allowed under SDCL § 54-3-4 → § 54-3-16.
This restates what South Dakota law applies when your contract is silent. If your contract sets a rate, quote that instead. The wording doesn't say when interest starts, because that differs by state; the note at the top of this page covers it where South Dakota law sets it.
How South Dakota compares
South Dakota is one of 4 states with no rate that applies on its own, along with Maine, New Mexico and Tennessee. Elsewhere the middle of the range is 8%.
Interest is the fallback. Getting paid on time is the plan.
DueTrail turns overdue invoices into managed cases with reviewable reminders and recorded promises to pay, so invoices get settled before anyone reaches for SDCL § 54-3-4 → § 54-3-16.