The Covid-19 pandemic has changed the view of the global world as researchers and scientists continue to look for a cure. Until recently, the cannabis plant had different scientific uses. Currently, the community is gathering data to support the notion that cannabis may be beneficial in preventing COVID-19. This comes when the country is considering the SAFE Banking Act.
SAFE Banking Act
Politicians are looking to reintroduce the Secure and Fair Enforcement (SAFE) banking act into the new round of coronavirus legislation. The bill’s purpose is to ensure an increase in public safety by providing cannabis businesses access to financial services. The Act is full of possibilities for the industry’s needs, the international cannabis industry, and the post COVID economy needs Act.
State-compliant cannabis businesses cannot accept credit cards, access loans, set up deposit accounts, write checks, pay taxes, or operate payroll without a cannabis-friendly bank. This enables money laundering and tax evasion, prohibiting the country from keeping up with its neighbors in the commercial global cannabis economy.
Colorado cannabis banking legislation over the past decade have tried to ensure the cannabis industry has access to deposit institutions and federal payment system such as credit card merchant processing. The efforts have been unsuccessful due to worried bankers. It is critical to understand the national picture and the impact it continues to have on the economy.
Advantages of Cannabis Banking
In these uncertain terms we are living through, it is becoming more apparent that the government needs to recognize the economic value of the marijuana industry. The first step is in the SAFE Banking Act, which provides that federal regulations should not hinder the actions of depository institutions dealing with legal cannabis businesses. The Act safeguards financial institutions that do banking for cannabis business while clarifying that federal regulatory borders do not interfere or punish institutions collaborating with legitimate cannabis businesses.
The legislation intends to bridge the gap between the legal standing of cannabis companies and particular states and the federal prohibition of the usage and sale of marijuana. In restricting cannabis banking access to cannabis companies, obvious problems force them to work with large amounts of cash. Banks that operate with cannabis enterprises raise compliance regulations or expose them to federal punishment. Cannabis companies struggle to get the needs loan to launch a new business or grow the existing ones.
The Act, which the Senate had earlier rejected, has been added by Democrats to the Coronavirus relief package. The return and passage of the Act are vital since marijuana is classified as a Schedule I drug under federal law.
Supporters of Cannabis Banking
So the biggest question is, can dispensaries in Colorado use banks? The Act also ensures tracking revenues for regulatory compliance purposes, and taxation becomes easier while offering proper large-scale capital backing.
The cannabis industry continues to grow exponentially, which does not seem to be stopping anytime soon. Globally a lot of nations have embraced lawful commercial cannabis to this extent. The Banking Act wants to solve the conflict by expressly allowing cannabis enterprises to bank cannabis revenues. The industry also has more exposure to lines of credit, lending, and investment-related tools.
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