While the Republican party has traditionally held an anti-cannabis stance, the Senate committee just scheduled a hearing to discuss business banking access for cannabis companies.
The powers that be on Capitol Hill seem to finally be coming around to the reality that cannabis legalization is happening. While there may still be a complex issue at the federal level, numerous states have legalized cannabis – both medically and recreationally – and that in itself has created a plethora of problems. One of the most significant of those problems is the lack of business banking access provided to those in the already thriving multi-billion dollar cannabis industry.
The drive to solve the unacceptable problems faced by cannabis companies and their employees is gaining support. The hearing, scheduled for next week by the Senate Committee on Banking, Housing and Urban Affairs will see discussions about a new house cannabis banking bill.
The bill, which has 206 cosponsors, cleared the chamber’s Financial Services Committee with a bipartisan vote back in March. Pressure has been brought to bear recently as banking associations from 50 states, as well as the National Association of State Treasurers and others, are calling on Congress to solve the issue.
The chief complaint from those spearheading the bill is that by preventing cannabis companies from engaging in banking services, they’re forced to deal only in cash. That’s a massive problem in terms of money laundering, paying taxes, and most of all, robberies. Due to the lack of business banking access for cannabis firms, they are often the target of violent and sometimes deadly armed robberies.
They’re primarily targeted as it’s known they hold large amounts of cash on their premises as they have no other choice. And that’s not to mention the inconvenience to customers who want to pay by check or credit/debit card for their medication.
While a vote on the bill ideally needs to come before the August recess, that doesn’t look likely at the moment. On the other hand, Minority Leader Kevin McCarthy (R-CA) spoke about the bipartisan support for the initiative. “There’s an issue when it comes to banking, making sure you’re able to having accountability within that,” he said.
“I’ve heard a lot of bipartisanship in there,” he added. A spending bill was also passed by the house, including a provision to stop federal institutions from penalizing banks who work with cannabis companies which are legal at the state level.
At the same time, representatives from the Credit Union National Association (CUNA), Citywide Banks, and prohibitionist group Smart Approaches to Marijuana will attend a conference to discuss the matter. CUNA President and CEO Jim Nussle said, according to the same report, “At its heart, cannabis banking is a public safety issue. It’s an $8.3 billion industry that’s currently being forced to operate almost entirely in cash.”
Nussle also spoke about the issues faced by states where cannabis is legal and the difficulties they face. “While 33 states, territories and DC have legalized cannabis, it’s been overwhelmingly difficult to provide these businesses financial services because handling transactions are currently considered money laundering,” he said.
“Credit unions have been leading the way in helping to get this money off the streets. We are dedicated to finding a solution to this ongoing challenge that impacts every community around the country, and look forward to working with Senate leaders during this hearing and with Congress at large.”
CEO of CTF, Neal Levine, also said he hoped the new cannabis policy reform would pass. “This hearing is yet another sign that Congress is taking the cannabis banking problem seriously and intends to take action to correct it,” he said. “Cannabis businesses operating legally under state and local laws should have the same access to banking and financial services as any other type of business.”
History is definitely in the making after the House Judiciary subcommittee held a meeting about a subject that was unthinkable just a decade ago. That subject discussed ending federal cannabis prohibition once and for all. It remains to be seen what the lawmakers on Capitol Hill will do when it comes to banking access for the industry and cannabis legalization in general. What’s for sure is that the winds of change are certainly blowing, as the world enters a new era of cannabis legalization.