The Cannabis Industry Is Underbanked—But That’s Finally Changing
An increasing number of banks and credit unions are providing banking services to marijuana-related businesses, a sign that business momentum is slowly building.
The number of commercial banks, credit unions or savings institutions offering the services grew from 337 in January 2017 to 715 in June 2019, as the industry expanded with the start of legal recreational marijuana sales in Nevada, Massachusetts and California, according to data from the Financial Crimes Enforcement Network (FinCEN), a regulatory agency under the Treasury Department.
“We’re now hearing it, and we are seeing it,” said Sammy Dorf, founder and chief growth officer of Verano Holdings. “The new catalyst might be coming and that would drive the markets for the growth of cannabis industry.”
Marijuana is still an illegal Schedule 1 drug at the federal level, and banks risk chances of federal prosecutions and penalties in some cases. The U.S. House of Representatives last month passed the bipartisan SAFE Banking bill, aimed at allowing complete banking access to cannabis companies. Its fate is uncertain in the Republican-controlled Senate.
Many cannabis industry insiders point to momentum building as more states legalize the industry. Jeremy Unruh, a spokesman for PharmaCann, said banks in the cannabis industry have a herd mentality. As more people begin to talk about legal protection for federal banks taking on marijuana companies as their clients, more banks start to test the waters.
To Read The Rest Of This Article By Minho Kim on Crain’s Chicago Business
Published: October 14, 2019
LA Cannabis NewsFounder & Interim Editor of L.A. Cannabis News
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