Cannabis is rapidly changing the United States economy and also the global economy. As time progresses, more states within the land of the free and the home of the brave as well as nation-states abroad are legalizing the plant for both recreational and medical purposes.
Cannabis is a job-creator and also a massive macroeconomic stimulus that has the potential to serve as a historic metaphorical economic tide that lifts all boats. However, if you are like most people, you may wonder whether cannabis banking is legal. Here's a quick look at the state of the cannabis industry and cannabis banking as of the fall of 2022.
It wasn’t long ago when the primary allure of cannabis was its inherent ability to relieve pain and induce a feeling of euphoria. Today's cannabis is more potent, flavorful and rewarding than ever. The plant is now gaining acceptance with those outside of its traditional sphere of influence. Entrepreneurs, marketers, tax dollar-hungry politicians and even those in ancillary cannabis-related businesses such as gardening supplies are raking in the cash. The challenge lies in capturing as much market share as possible before the competition beats you to the punch.
The cannabis cash craze has begun. The question is whether you are ready to capitalize on this potentially invaluable opportunity. A guided and professional approach to cannabis banking facilitates a seamless foray into this emerging space. If you are wondering, “How do weed dispensaries bank?”, you are not alone. You’ve surfed the internet over to the right place. Lay the groundwork for a successful cannabis business foundation with the guidance of our cannabis banking team and you’ll hit the ground running.
Indeed, it is possible for banking institutions to open accounts for cannabis dispensaries. The winners of the
cannabis cash race will be those that do their homework and focus on preparation. However, the average person struggles to keep his or her finger on the pulse of the cannabis industry, cannabis legalization progress, local laws, state laws, federal laws, etc. Fret not, as our cannabis banking professionals are here to guide you to success.
Studies show banking activity is spiking across states that have legalized marijuana. Banking trends in these states are identified through the analysis of bank regulatory filings placed with the Federal Deposit Insurance Corporation or FDIC for short. The study delved into information from thousands of banks across nearly the entirety of the country. The findings revealed both cannabis business loans and deposits jumped significantly in states that had legalized the plant.
The results of the study referenced above surprised some, as credit unions, banks and other financial institutions are susceptible to financial penalties inflicted by the federal government for providing services to businesses that sell a Schedule I substance. Furthermore, it is also worth noting that deposits jumped by about 4% after cannabis legalization. Cannabis banking lending also jumped by about 7 to 8% after legalization.
At the moment, the letter of the law technically limits cannabis dispensaries to cash transactions as the plant is still listed as a Schedule I drug at the federal level. However, as Bob Dylan is famous for saying, "The times, they are a changin'." Congress is making progress toward passing legislation that empowers cannabis businesses to open bank accounts without restrictions or other legalese in the small print of agreements that makes cannabis banking a gray legal area.
It might not be long until cannabis businesses can easily accept credit, debit, cash and possibly even cryptocurrency such as Bitcoin. At the moment cannabis business owners are legally empowered to open a bank account for their enterprise with certain banks, ideally under the guidance of a cannabis banking professional. However, we would be remiss not to mention that some banks are still slightly hesitant to provide services for cannabis businesses due to the fear of potential legal liability.
Though the Secure And Fair Enforcement Banking Act (SAFE) pertaining to cannabis banking had bipartisan support, the legislation has not made it through the Senate. As a result, some banks have high standards for cannabis banking or simply refuse service. However, there aren’t many instances of banks being criminally 
prosecuted for providing cannabis banking services. The silver lining is that some banking institutions are open to serving local cannabis businesses.
If you are considering launching a cannabis business, the key takeaway from this piece is that if you have the will to be successful, our cannabis banking team will show you the way in the context of financial transactions. Take comfort in the fact that a growing number of banking institutions are not concerned with the minor legal risk of taking on cannabis businesses as customers.
Though there is certainly the potential for regulatory risk, more and more banks are willing to make loans to cannabis businesses, accept deposits from cannabis businesses and ultimately help such enterprises stimulate the economy. Fast forward a year or two into the future and you just might find cannabis banking is socially and economically normative. When in doubt, lean on our cannabis banking experts for assistance in navigating the legal and regulatory maze and we'll help you maximize your bottom line.
Are you considering starting your own cannabis business? You’ve likely been wondering, “Can a dispensary open a bank account?” and "How do weed dispensaries bank?” We have the answers to these questions and more.
Whether you've already started writing your business plan or still brainstorming your new cannabis business, our cannabis banking specialists are here to help.
