Making it SAFE to bank the marijuana industry
Will Proposed Legislation Change the Risk Calculus for Financial Institutions?
As states continue to legalize medical and recreational marijuana, pressure is mounting on both marijuana-related businesses (MRBs) and financial institutions due to current federal restrictions.
While the marijuana industry becomes more legitimate—and more lucrative—its participants’ need for traditional banking products and services increases. Conversely, current federal laws make capitalizing on this emerging new client base an extremely risky proposition for financial institutions.
However, the recently introduced Secure and Fair Enforcement (SAFE) Banking Act might finally reconcile this conflict by providing safe harbor to those institutions that bank MRBs, and momentum for its passage is growing. In fact, the attorneys general of 38 U.S. states and territories pushed for it in a letter to Congressional leaders, in which they highlighted the benefits of regulating “grey market financial activities” like marijuana.
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