As the cannabis industry pushes forward at light-speed deemed an essential service during the coronavirus pandemic, a solution to the existing banking problem isn’t. Though there has been progress, no standard exists yet.
Every legal cannabis state is making their own systems in lieu of a federally endorsed solution. Moreover, legal advocates cite the need for a federally regulated banking option to minimize robbery and violent crime associated with a cash-only industry like cannabis.
States Navigate Federal Waters
The federal government continues to classify cannabis as a schedule 1 drug. As a result, the responsibility gets piled onto state regulators. They struggle to develop a comprehensive, legitimate, and secure banking system that works for everyone.
One thing that legal states have been able to advance, to the federal level, is the passing of the Secure and Fair Enforcement Banking Act (SAFE). SAFE protects banks that take on cannabis clients from unfair federal oversight.
As the SAFE Act moves from the House to the Senate lawmakers are optimistic. This progress indicates there will be a nationally recognized banking system for cannabis in the near future. Furthermore, the coronavirus catapulted the discussion when lawmakers included SAFE into the language of the recent COVID19 Bill. Citing public health and safety reasons related to the cash-only transactions that are transpiring at every legal cannabis dispensary.
What’s Happening On The Front Lines
Regardless of regulatory limitations, cannabis entrepreneurs have been banking for years. Many small, community banks have a turn the other cheek policy toward cannabis business accounts. Even larger, corporate banks have been known to open accounts for cannabis businesses, so long as the paper trail looks clean.
Transparent banking is available for cannabis businesses through financial organizations like Dama Financial. Private institutions, like Dama, are starting to organize and provide ‘transparent banking’ to cannabis businesses, although for a hefty fee. Transparent cannabis banking solutions are known to charge hefty deposit fees. Additionally, they have requirements for minimum balances and monthly deposits.
Cannabis Industry Awaits Federal Leadership
In spite of the bipartisan volley that cannabis-related issues seem to inspire, the reality of a cash business in the COVID19 world is something both sides should be able to agree on. Dispensary owners understand that the coronavirus has added one more layer of urgency to their banking dilemma and the challenge is to get lawmakers to agree. There’s a possibility that the coronavirus may finally make that possible.