Cannabis Might Not Be a Cash-Only Business as Banking Bill Gets Key Vote
The R Street Institute, often described as a conservative or libertarian think tank, applauded the bill moving forward. Current laws can discourage financial institutions from dealing with cannabis-related businesses, leaving many dispensaries as cash-only operations.
“While some lenders have dipped their toes into the cannabis market, most did so initially under the legal safe harbor offered by the 2013 Cole Memorandum, which the U.S. Justice Department formally rescinded in January 2018,” said R.J. Lehmann, the director of finance, insurance, and trade policy for the R Street Institute in a statement. “Because of this uncertainty, lenders who serve the market need to be prepared to unwind their loans at any moment. And without the kind of permanent safe harbor the SAFE Banking Act offers, many other lenders — including those with the kinds of robust compliance processes needed to service this sector effectively — remain on the sidelines.”