Industry Insiders Predict SAFE Banking Act Could Pass as Early as October
Over the past few months, we covered the progress of the SAFE Banking Act as the fate of financial services to dispensaries hung in the balance.
Despite being medically legal in 33 states and fully legal in 11, financial institutions avoided these businesses like the plague. Consequently, cannabis businesses were denied loans, basic banking services and other critical tools that enterprises and individuals take for granted.
This resulted in owners hoarding ludicrous amounts of cash, making dispensaries prime targets for robbers, both for their money and inventory.
Regardless, federal banks remain fearful of prosecution for their involvement with legal cannabis businesses. The Secure and Fair Enforcement (SAFE) Banking Act seeks to change that, effectively making banks immune to federal prosecution should they decide to service the cannabis industry.
The SAFE Banking Act already passed the House Financial Services Commission with strong bipartisan support. As a result, Marijuana Moment reports one expert is highly optimistic that soon, banks will be open to this new, ever-growing market.
SAFE Banking Act Will Likely Pass
It is certainly not uncommon for experts to weigh in on issues like this, but one person whose opinion truly carries weight Rob Nichols, CEO of the American Bankers Association.
He said in an interview:
“[The SAFE Banking Act] is something that I predict…as early as September—probably no later than than October—will pass the full House of Representatives by a bipartisan majority, which is exciting.”
Nichols is of course prepared to fight hard. He explains that the ABA intends to put a lot of time and effort into lobbying for this bill to pass.
“More Work to Do”
The SAFE Banking Act is hardly a tough sell in the Democrat-controlled House of Representatives.
In the House, 206 representatives cosponsored the bill, which included 26 Republicans. However, the bill will need more bipartisan support in the Republican-controlled Senate.
Nichols is aware of this obstacle, acknowledging that there is “more work to do” when trying to win over support from the historically less marijuana-friendly right-wing politicians.
But Nichols is still optimistic, saying:
“[There are] 33 states where it is legal and so there’s a lot of senators who have been hearing from their constituents about these challenges in those particular states.”
He also mentions how Treasury Secretary Steven Mnuchin – a Republican – supports changes related to the current banking roadblock.
Clarification is Necessary
Technically, engaging with marijuana businesses does not guarantee any kind of federal repercussions for banks. The government may take the same “hands off” approach with financial institutions as they now do with legal states (despite repealing the Cole memo).
But understandably, no major corporation wants to expose itself to litigation, especially when it is a federal crime.
Banks need to feel protected and will not budge until they know the law is on their side. Nichols says:
“Again, we understand the cultural, societal and moral implications of this issue, but we need federal rule clarity so banks know who they can and cannot lend money to.”
WeedAdvisor’s Services Bridge the Gap
Given that the cannabis industry in the U.S. has never had access to basic financial services, suddenly obtaining the ability to use banks will take some adjustment.
Fortunately, WeedAdvisor offers a variety of business solutions intended to make daily operations as simple as possible. One notable area is auditing, available as part of our EUGMP platform.
Coupled with several other services intended to assist with quality control, compliance and more, we ensure flawless day-to-day functions – financial or otherwise.