More than 100 cannabis business leaders from across the United States met with congressional members this week and called for passage of the bipartisan SAFE Banking Act during a lobbying event held on Capitol Hill by the National Cannabis Industry Association (NCIA).
The SAFE Banking Act — formally known as the Secure and Fair Enforcement Banking Act of 2021, H.R. 1996 — would prohibit a federal banking regulator from penalizing a depository institution for providing banking services to a legitimate cannabis-related business.
U.S. Rep. Ed Perlmutter (D-CO) introduced H.R. 1996 in March 2021 for the seventh time. The bill has 180 cosponsors in the U.S. House of Representatives, which passed the measure in April 2021. Since that time, H.R. 1996 has been under consideration in the U.S. Senate Banking, Housing, and Urban Affairs Committee, which is also reviewing its version of the same-named bill, S. 910, also introduced in March 2021 by U.S. Sen. Jeff Merkley (D-OR).
The cannabis business leaders, who are members of NCIA, traveled to Washington, D.C., to attend NCIA’s 10th Annual Cannabis Industry Lobby Days held Sept. 13-14. They are meeting lawmakers to push for the Senate’s approval of the bill, which would provide safe harbor to financial institutions that do business with them, according to NCIA.
Currently, many such businesses are forced to operate on a cash-only basis that has led to increased predatory lending and a lack of traditional financing options, according to the authors of the proposed legislation.
“Nine years after first introducing legislation to allow cannabis businesses access to the banking system, the $25 billion industry is still forced to operate primarily in cash,” Rep. Perlmutter said Wednesday. “That’s not right.”
Perlmutter added that the federal government needs to create a more equitable industry, and to do that, “the Senate needs to pass SAFE Banking.”
Sen. Merkley agreed, noting that every legal business deserves the same access to the same resources, including bank accounts, loans, and payment processing, among others.
“When it comes to cannabis, the country is changing fast and it’s long past time that our federal laws caught up,” said Merkley.
And as more states across the country vote to change their marijuana laws, Merkley said that legitimate cannabis companies can’t keep operating entirely on cash.
“This is a nonsensical rule that is an open invitation to robbery and money laundering,” the senator said, adding that lawmakers need to ensure “that all legal cannabis businesses have access to the financial services they need to help keep their employees and communities safe.”
According to U.S. Sen. Steve Daines (R-MT) — who is the lead original cosponsor of S. 910, which has 41 other cosponsors as of today — cash-only operations are also a public safety issue.
“When legal Montana cannabis businesses don’t have a way to safely conduct business and we are forced to operate in all cash, our communities become vulnerable to crime,” said Daines, pointing out that the SAFE Banking Act would provide needed certainty for such businesses to freely use banks, credit unions, and other financial institutions that wouldn’t have to worry about being punished.
“I stand with the attorneys general across America that want to increase public safety and reduce crime,” Daines said. “It’s time we pass our bipartisan [bill].”
Aaron Smith, chief executive officer of NCIA and one of its co-founders, said the SAFE Banking Act enjoys bipartisan support because it’s a narrowly crafted bill that “harmonizes federal banking policy with the laws on the books in the vast majority of states that allow for some form of legal cannabis access.”
“The Senate needs to take swift action and pass this legislation, which is widely supported by a super majority of Americans across the political spectrum,” said Smith.
NCIA’s Cannabis Industry Lobby Days event also included a press conference earlier this afternoon with business leaders and members of Congress.