It’s been a couple years now since Colorado and Washington first legalized recreational use and sale of marijuana. In that time we’ve seen lots of changes, but one of the most important things that needs to change, but simply hasn’t, is the lack of banking access for cannabis companies.
One of the most dangerous things about the current legal status of marijuana is the continued cash-only nature of the business. Dispensaries operating in big cities like Denver or Portland face a much higher risk of robbery than the smaller towns, but for each and every one of them it should be considered a very real possibility.
There are so many possible bad scenarios with moving this much money in cash bills – after all, in each state marijuana sales are pretty much a multi-million dollar industry and none of it is paid for with credit or debit cards of any kind.
The main reason that banks are staying away from marijuana businesses is in fear of retaliation by the federal government. By taking on cannabis businesses under current federal law they face the possibility of asset seizure and the loss of their FDIC insurance – and this goes for all monetary establishments, credit unions included.
While it’s been a long time waiting we are finally seeing what could be significant progress on the subject of marijuana businesses and banking. An amendment was introduced this past Wednesday by Democratic Senator Jeff Merkley alongside six bipartisan cosponsors.
The amendment would prevent federal officials from punishing banks that choose to work with marijuana businesses, so long as those businesses are operating legally under all state laws, including licensing. It would prevent the government from prosecuting the banks, seizing assets and termination of FDIC insurance with all cannabis businesses.
This is not the only piece of legislature floating around on the subject at the moment – there is actually a standalone bill in both the House and Senate respectively. Each of the bills focus on easing restrictions set on banking with marijuana businesses, but this new amendment seems like it would do well at ensuring everyone had a clear understanding.
Others who have signed their names in support of this amendment include Harry Reid, Sens. Elizabeth Warren, Michael Bennet, Patty Murray, and Senator Rand Paul. This is a much needed amendment – however it needs to be given a chance to work.
Hopefully the Senate will be voting on this newly proposed Amendment soon. I’ve said it before and I’ll say it again – keeping marijuana a cash only business keeps the shady underground market look. If we want this to be a respected industry, it deserves all the same rights as other industries in the nation, including access to banking and other financial support.