California attempts to legalize banking for marijuana businesses

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Lawmakers make another attempt to fuse finance and marijuana

The federal government could pass legislation this year that would allow financial institutions to work with marijuana companies without fear of reprisals, but some states aren’t waiting. A credit union in Alaska started an initiative to work with the marijuana industry and California is now taking things to the next level, considering legislation that would protect banks and provide much-needed access to marijuana companies in the state.

A plan has been developed in the Golden State that would encourage more banks to work with marijuana companies, in spite of the federal limitations in place. It is only a small step forward, but it is still a step in the right direction. The General Assembly bill would allow state regulators to share details on sales, cultivation and other facets of the operations of cannabis companies with banks in order to prove to those financial institutions that the businesses were legitimate and operating within the boundaries of the state’s laws. The banks have argued that they haven’t warmed up to the cannabis industry because they haven’t been offered those reassurances.

There are now 400 banks and credit unions across the country that are willing to risk the wrath of the federal government and have begun to work with cannabis companies. However, this is an extremely low percentage of the available institutions and isn’t enough to cover the entire industry. With over 30 states having legalized medical marijuana, and the federal government having legalized hemp cultivation, protection for banks working with cannabis companies is long overdue.