Colorado to increase banking access for cannabis business
Federal banking has been out as far as the cannabis industry is concerned. There are some new strategies for Colorado banks and other financial institutions to work with in the hemp and cannabis industry.
Marijuana remains controlled by federal law. That means that Colorado’s cultivators and dispensaries remain strictly forbidden from obtaining financial services, such as loans or lines of credit, and they can not accept credit cards. The lack of federal clarity makes banking institutions making credit unions and banks not comfortable with providing services to the legal marijuana dispensaries. This does not seem fair for a legit business.
The SAFE banking act is working on opening the opportunity for the legal business that provides recreational and medical marijuana. In September, the bill passed the house of representatives, and it is presently being looked at is the senate. They are hopeful it is going to be up for a vote sometime in 2020.
Many issues arise from this financial issue dispensaries have been compelled to deal only in cash makes it more vulnerable to armed robbery. Colorado has been a big supporter of legal marijuana. The safe ACT is another step in the right direction.
As of now, only a handful of financial institutions provide service to the cannabis industry. The banks that are doing business with cannabis companies are having them sign a non-discloser form. To avoid being looked at closely. The few banks that are taking on cannabis companies are only willing to take on a small number of clients at this time.
Hopefully, the SAFE banking act can change that as the cannabis industry is a legit income and should be allowed to offer the option of paying with a credit card that can bring lots of revenue to the banking institutions.
Since the SAFE act passed in 2013, one would think this would be an easy fix. The issue sits with the federal government. As of now, we can only sit and wait for the government to make this transition more accessible for the banks, so they don’t fear any legal consequences.
Colorado and Washington were the first two states to legalize cannabis for recreational use in 2012. Surprisingly, the baking system is still so far behind that.
Salal Credit Union
It is one of the institutions working with cannabis retailers in regard to cash. If you want to have this credit union work with your company, the following must be checked first:
- The business must be licenced in the state that you operate in
- You must have proven good credit
- You can not have any outstanding federal liens
- They currently only server Washington and Oregon
That seems straight forward and easy to follow, so the question is why other institutions can’t follow suit. In the next few months, we will see what the outcome of the banking systems is. This is just another reason that marijuana needs to be legalized across the board, as too much time is being wasted on things like whether or not banks should accept cash from cannabis producers. This can be much easier if we all just get this passed and treat the marijuana industry the same as every other retailer.