It’s fitting that, on 4/20, the House of Representatives passed legislation designed to allow cannabis companies access to banking; it’s about time.
We’ve written and tracked the progress of the SAFE Banking Act. This is now the fourth time that the House has backed this legislation, passing on the bill to the Senate where, like so many bills over the past four years, it dies.
That may sound dramatic, but it’s hard not to get frustrated. Right now, cannabis is a cash-only industry, which severely limits the type of individuals who can play a role in the development of cannabis and take responsibility for its future. Businesses across the country, from growers to processors to retails, have tended to be wealthy white men; that’s not a reflection of the cannabis customer base as a whole, and it goes against the very tenants of a free market society.
It’s a situation that can’t last much longer for a number of reasons. First, marijuana is essentially legal in the US; 47 states now have some level of legalization, with four states adding recreational use laws in 2021 alone. Second, there’s simply too much money to be made. Cannabis is expected to be a $3 billion dollar business in the state of Michigan alone this year, and experts predict it will reach between $22 and $26 billion nationally in 2021.
For years, banking institutions have refused to offer their services to cannabis companies out of fear of being prosecuted by the federal government. Each of the four bills concerning SAFE Banking – once in 2020 and twice in COVID-19 stimulus legislation – focused on protecting banks and making the loan process risk-free in regards to cannabis.
Access to financing could completely change the face of who can create and grow cannabis companies. Additionally, it’s a vital step in supplying the funds necessary for cannabis facilities to invest in the energy efficiency measures necessary to fix marijuana’s emissions problem. Cannabis is an energy-intensive industry that needs some serious investment to avoid contributing to a climate disaster. This funding would play a vital role in both encouraging and possibly requiring more stringent energy efficiency standards to reduce cannabis’ energy appetite and voluminous carbon emissions.
Want to learn more about what Keen Technical Solutions can do for your cannabis facility? Let