Justice and Treasury Departments issue guidance clearing the way for banks to serve state-authorized cannabis businesses
Legal cannabis industry projected to produce $2.57B in revenue in 2014, a ripe new market for financial services
DENVER – The National Cannabis Industry Association (NCIA) today lauded the opening of banking services for the multi-billion-dollar legal cannabis industry. Guidance issued today by the Departments of Justice and Treasury makes it clear that banks are allowed to serve cannabis businesses operating legally under state law.
In fact, the guidance issued by the Financial Crimes Enforcement Network (FinCEN) included this sentence, removing any doubt about whether the federal government was signaling that this activity can be conducted: “This FinCEN guidance clarifies how financial institutions can provide services to marijuana- related businesses consistent with their BSA obligations.”
“This is a huge victory for our members, our communities, and the banks that take this opportunity to serve a thriving new market,” said NCIA executive director Aaron Smith.
“The legal, regulated cannabis industry is legitimate, professional, and prospering, and our businesses deserve to be treated like those in any other American industry. We’re looking forward to developing beneficial and long-lasting relationships with financial institutions that are ready and eager to work with us.
“We’re grateful to officials at the Treasury and Justice Departments who have been working to resolve this banking crisis. No legitimate business should be forced to manage its payroll, taxes, utility bills, and licensing fees entirely in cash. Today’s guidance allowing for banking access means better security for our members, easier accounting and transparency, and more resources to invest in our local economies.”
Prior to today’s federal guidance, most financial institutions had been unwilling to provide even the most basic banking services, such as checking and savings accounts, to medical or adult-use marijuana businesses. This forced state-authorized businesses to handle their financial transactions entirely in cash.
NCIA and its members will continue to call on Congress to provide even further clarity for financial institutions serving the industry, but today’s guidance clears the way for banks to accept state-legal cannabis businesses as clients. Those banks who do will be adding a flourishing industry to their portfolios — the latest projections from industry analysis firm ArcView Market Research indicate that the legal cannabis industry will add $2.57 billion to the American economy in 2014.