Cashless Bank Transfers For Cannabis Companies? 22 Governors Say Yes And Take Their Case To Congress

Politicians, some of them, have finally decided to do something about the seemingly endless cannabis banking problem.

Colorado Governor Jared Polis, Michigan Governor Gretchen Whitmer and 20 other state governors signed a letter demanding that Congress pass the Secure and Fair Enforcement Banking Act, which would allow marijuana-related businesses to make cashless transactions, reported The Street. 

The main motivator to resolve one of the biggest problems of the industry was to make cannabis operators less vulnerable to crime, by placing them under the national banking umbrella.

"Operating all-cash businesses poses an inherent danger for businesses in our state, and the SAFE Banking Act provides clear guidelines for our financial institutions to bank with these businesses,” Whitmer told ABC 12 News in an interview.

Just this week, Republicans released their marijuana legalization proposal led by Rep. Nancy Mace (R-SC). The measure, titled the States Reform Act, is currently in a preliminary form although a final version is expected soon.

Under the proposal, cannabis would be federally regulated similarly to alcohol. Its leading regulator in terms of interstate commerce would be Treasury's Alcohol and Tobacco Tax and Trade Bureau with the FDA

responsible for some regulations. The proposal also suggests a 2.75% excise tax on cannabis sales, with revenue backing various grant programs. 

This important industry news caused marijuana stocks to trade higher this week. 

“Medical and recreational cannabis sales in the U.S. were estimated to total $17.5 billion last year, but because of antiquated federal banking regulations, almost all cannabis transactions are cash-based,” Polis wrote in a letter to Congress and cited by Denver-based FOX 31.

Considering the size of the industry and the projections for its further growth, dealing in cash only is a serious and at times physically dangerous problem for cannabis operators.

So far, eighteen states have legalized recreational marijuana and as many as 37 states now have legal medical marijuana programs.

Photo: Courtesy of Jonas Leupe on Unsplash