Imagine operating a business without a bank account. Or having to pay each of your employees and vendors in cash. Imagine being forbidden from letting your customers pay for purchases with a credit card, or being able to ask a bank for a small business loan.
This is the reality of hundreds of small and medium-sized business owners throughout the country who are engaging in the emerging cannabis marketplace.
To date, nine states – Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon and Washington – permit retail sales of recreational marijuana to adults. Furthermore, a total of 33 states have enacted policies to establish a regulated medical cannabis program.
Currently, state-licensed marijuana business face a web of conflicting regulations. Specifically, federal prohibitions largely prohibit these businesses from partnering with financial institutions, processing credit cards and taking standard business deductions.
No industry can operate safely, transparently, or effectively without access to reliable banking solutions. While it is encouraging to see that a small but growing number financial operators are beginning to provide necessary services to those engaged in state-compliant cannabis commerce, it is self-evident that this industry will remain severely hampered without better access to credit and financing.
In 2017, then nominee for Treasury Secretary Steven MnuchinSteven Terner MnuchinOn The Money: Lawmakers wait for Trump verdict on border deal | Trump touts deal as offering B for security | McConnell presses Trump to sign off | National debt tops T | Watchdog details IRS shutdown woes Trump open to extending trade talks with China Conway: Trump and Xi ‘will meet again soon’ with trade deadline looming MORE was asked about these financial hurdles. Mnuchin stated, “I will work with Congress and the President to determine which provisions of the current tax code should be retained, revised or eliminated