“We’ve got momentum on our side,” said Sen. Jeff Merkley. “Let’s get this done to protect our legal cannabis businesses!”
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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