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safe banking act
Marijuana Industry Banking Bill Passes Key Senate Panel
"We've got momentum on our side," said Sen. Jeff Merkley. "Let's get this done to protect our legal cannabis businesses!"
Sep 27, 2023
The U.S. Senate Banking Committee on Wednesday brought major federal marijuana banking legislation closer to becoming law than ever, approving a bipartisan bill that advocates say is essential to the safety of legal recreational and medical marijuana businesses across the United States.
The committee voted 14-9 in favor of passing the Secure and Fair Enforcement Regulation (SAFER) Banking Act, which would legally protect banks and credit unions that provide services to cannabis operations and prohibit federal regulators from ordering financial institutions to close a business' account based on "reputational risk."
An earlier version of the bill passed in the U.S. House numerous times but was never advanced in the Senate under either Democratic or Republican control.
"We've got momentum on our side to finally pass the SAFER Banking Act," said Sen. Jeff Merkley (D-Ore.), who is sponsoring the legislation along with Senate Majority Leader Chuck Schumer (D-N.Y.) and Sens. Steve Daines (R-Mont.), Cynthia Lummis (R-Wyo.), and Kyrsten Sinema (I-Ariz.). "Let's get this done to protect our legal cannabis businesses!"
Although 39 states have passed laws legalizing the sale of marijuana for recreational or medical use, advocates say dispensaries are put at risk by a lack of federal protections for financial institutions that might otherwise work with them.
Only 12% of all U.S. banks and 5% of credit unions provide banking services to marijuana-related businesses, according to the U.S. Department of Treasury.
As Common Dreams reported, Mastercard announced in July that it would no longer offer services in the cannabis industry because marijuana is still criminalized at the federal level—even though annual national sales in the sector are projected to reach $57 billion by 2030 in states where cannabis is currently legalized.
NORML, which has advocated for marijuana decriminalization since 1970, noted on Wednesday that more than 70% of cannabis businesses report that a "lack of access to banking or investment capital" is their top challenge.
Without access to banking services, businesses are forced to make sales only in cash, which Merkley said is "an open invitation to robberies, muggings, money laundering, and organized crime."
"Forcing legal businesses to operate in all-cash is dangerous for our communities," said the senator.
NORML political director Morgan Fox called the newly advanced legislation "an improved version of the SAFE Banking Act."
"It allows state-licensed cannabis businesses to more easily access financial services, such as opening a simple bank account, and it provides entrepreneurs with greater access to lending and other services that are available to other legal businesses," said Fox.
Schumer called the passage of the bill out of the committee "a huge step," and said he is also working to include amendments to expunge people's marijuana-related criminal offenses in the final bill.
"Now is the time," said the senator.
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Mastercard Move at Cannabis Shops Intensifies Call for US Decriminalization
"An industry that employs hundreds of thousands of people, provides billions in economic benefits, and promotes safer alternatives to pharmaceuticals and commonplace vices continues to be treated like a pariah," said one cannabis entrepreneur.
Jul 28, 2023
Cannabis reform advocates on Friday said a new decision by credit card company Mastercard illustrates why the substance must be decriminalized at the federal level to ensure that legal U.S. dispensaries are able to operate safely and securely.
The company announced this week that it has instructed U.S. financial institutions to stop allowing customers to use its debit cards to purchase marijuana products at cannabis stores, which now operate legally in 38 states for medicinal use and 23 states for recreational use, as well as in the District of Columbia.
Mastercard said it made the decision because marijuana remains criminalized at the federal level, despite major progress in recent years as the Marijuana Opportunity Reinvestment and Expungement (MORE) Act was passed by the U.S. House last year.
Darren Weiss, president of multistate cannabis operator Verano Holdings, said Mastercard's decision shows how the industry is still treated as a "pariah" despite its annual national sales projected to reach $57 billion by 2030, or as much as $72 billion including several states where cannabis is expected to be legalized.
A number of advocates including Sen. Jeff Merkley (D-Ore.) said Mastercard's move demonstrates the need for the Secure and Fair Enforcement (SAFE) Banking Act, which would protect banks and credit unions for being penalized by federal regulators for working with legal cannabis stores.
"I will not stop pushing to get SAFE Banking passed so legal cannabis businesses can access necessary financial services," said Merkley. "Cannabis businesses are still in dire need, and the majority of the country with state-legalized recreational cannabis can't wait."
While expressing appreciation for the SAFE Banking Act and its advocates in Congress, Weiss pointed out that the legislation would not address the fact that marijuana is criminalized at the federal level, which was the objection Mastercard said it has to working with cannabis dispensaries.
"SAFE Banking as drafted won't fix the credit card issue, and Mastercard's position won't change as a result," said Weiss. "We need comprehensive cannabis reform, and we need it yesterday."
The "awful news," said Columbia University fellow Raúl Carrillo, "shows the pitfalls of trying to reform cannabis finance without decriminalizing and legalizing weed on the federal level."
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