Members of the United States Senate Committee on Banking, Housing, and Urban Affairs are scheduled to hear testimony next week regarding the need to provide greater access to financial services for state-licensed marijuana-related businesses.
The Senate hearing, titled “Challenges for Cannabis and Banking: Outside Perspectives,” will take place on Tuesday, July 23, at 10am est. It marks the first time that members of the Senate have explicitly discussed the need for marijuana-related banking reform.
Federal law and regulations currently discourage banks and other financial institutions from working directly with state-licensed cannabis businesses. According to recently published data from the US Treasury Department, fewer than 500 financial institutions nationwide currently provide services to cannabis-specific establishments.
Members of the House Committee on Financial Services, Subcommittee on Consumer Protections and Financial Institutions previously heard testimony on the issue in February. NORML submitted written testimony to Congress at that time opining: “For an industry seeking legitimacy and requiring transparency, the inability to obtain banking and credit access remains a primary but unnecessary roadblock. In order to truly bring the marijuana industry out of the shadows, actions need to be taken by Congress to amend these outdated and discriminatory practices.” (Read NORML’s full testimony here.)
Legislation (HR 1595 | S 1200 – The SAFE Banking Act) is pending in both chambers to create new federal protections for financial operators who work with state-compliant marijuana businesses. The House version of the Act, which was passed out of Committee earlier this year, has over 200 Congressional co-sponsors while the Senate version has 31 cosponsors.
Speaking in support of the pending legislation, NORML Deputy Director Paul Armentano said, “Federal lawmakers are mandating that this billion-dollar industry operate largely on a cash-only basis – an environment that makes businesses more susceptible to theft and more difficult to audit.” He added: “No industry can operate safely, transparently, or effectively without access to banks or other financial institutions and it is self-evident that this industry, and those consumers that are served by it, will remain severely hampered without better access to credit and financing. Ultimately, Congress must amend federal policy so that these growing numbers of state-compliant businesses, and those millions of Americans who patronize them, are no longer subject to policies that needlessly place them in harms way.”
Additional information on The SAFE (The Secure and Fair Enforcement) Banking Act is available online here.