Federal protection may be on the way for institutions that work with state-authorized marijuana and cannabis-related businesses, bringing hope that the long-standing cash hassle for these businesses and payments, such as quarterly taxes, will be resolved in a satisfactory manner.
The Secure and Fair Enforcement Banking Act, or SAFE Act, saw a vote of 45-15 in favour from the House Financial Services Committee on March 28. From there, the SAFE Act will move to the full House voting schedule, and it is expected to see a vote within the next few weeks. Legislators believe the full House will also see a favourable vote, and relief for these banking institutions to allow them to serve cannabis businesses effectively.
Cannabis businesses, in addition to having a means to handle large transactions without cash on hand, will also have the opportunity to apply for loans. This has previously been a non-starter due to federal prohibition of marijuana and the banking industry’s hesitancy to serve businesses handling a federally prohibited drug.
The bill currently has 152 co-sponsors with both Democrats and Republicans backing the measure. This bill was first introduced six years ago, but it had not received a hearing in front of a committee until the end of March 2019. The bill at that time was co-sponsored by two Democrats and two Republicans, showing bipartisan support at its introduction and still not gaining any traction.
The bill stipulates that financial institutions are protected from federal punishment for serving cannabis businesses. Meanwhile, requirements for regulations to handle funds for these businesses would need to be complete within 180 days, and an annual report will be required for submission to Congress on financial service availability to cannabis businesses and the potential means of expanding those services.