Democratic legislators have sent a proposal to the US Senate in order to urgently request the approval of the SAFE Banking Act in order to fix the banking problem that the cannabis industry suffers from the restrictions placed on them by the system of regular banking.
With the approval of this Act by the Senate, it is possible to bank the American cannabis industry as the doors are opened so that all companies that are dedicated to this area can freely use all banking services and also market their shares in the main stock exchanges of the country.
In specific terms, it is also the legislation that would protect banking institutions from any liability or blocking action by the federal government for opening accounts, providing loans, or giving credit to companies engaged in the marketing and production of cannabis.
This bill was presented in 2019 to fix the banking problem that the industry presented, and the House of Representatives accept it in September of the same year, thus becoming the first independent measure approved by a full House of Congress in pro of the cannabis business.
All this generated high enthusiasm among the promoters of this industry; above all, it greatly encouraged that the issue was discussed in the Senate. However, this never happened due to the blockade immediately made by the then Senate leader, Mitch McConnell.
The bill remained in non-effect until it was presented again in March 2021, where it continues to insist that the only intention is to ensure that the money that comes from cannabis companies is not considered as “coming from illicit activities.” It’s very simple; the SAFE Act is for federal banking regulators not to take action against banks that work with cannabis companies.
Another problem that this industry has is that they cannot be listed on the main stock exchanges in the country, but they have been able to list on the Toronto Stock Exchange (in Canada) as an exception.
One of the reasons that cannabis companies argue for requesting banking is that this would open the way for them to use the profits in programs that promote social equity, specifically aimed at colleges and universities. With the SAFE Law for the banking of the cannabis industry, a further step is taken to decriminalize, at the federal level, the use of this plant or vice versa. Once decriminalized, the regulations will also descend.
Tax deductions, bank accounts, and obtaining loans are the main disadvantages of companies that are dedicated to the cannabis business in the United States. The legal cannabis industry in the United States is estimated to have sold $ 21.6 billion in 2020. The state of California alone sold $ 4.4 billion in cannabis flowers and other cannabis products and accessories. For its part, Colorado had a reported $ 2.1 billion in sales for 2020.
There are still several legislators who express their rejection of this law for different reasons, among which are “the amount of money, in cash, that would be produced,” which, although it would be legal, is not very financed.