In the United States, many cannabis-related businesses find it difficult to find banks who are willing to allow them to deposit their generated revenues with them. The major reason why this is so is because of the federal law that considered cannabis illegal. At the moment, only five states still consider cannabis illegal, all other states in the United States now consider it legal.

This issue of not holding a united forth concerning the legalization of cannabis on state and federal level prevents MRBs from obtaining banking services, it also increases the risks of businesses being exposed, because they have to handle a large sum of cash, which in turn increase the chances of getting rob, and making it difficult to make payments to others who do not accept cash, bodies such as the taxing bodies.

Also, businesses that handle a lot of cash such as the cannabis business are always easily exploited for money laundering, which in turn undermines the public-policy goal of creating legal and regulatory markets. With the assistance of, cannabis-related businesses have been able to successfully get banking activities done easily.

Moreover, hemp, which is usually referred to as marijuana’s first cousin,  and products containing cannabidiol (CBD) are now considered legal at the federal level (but some legal restrictions on these products still stand).

If you continue to read this article, then you will read more about the current U.S federal law regarding the provision of banking services to cannabis and hemp-related businesses, and also some of the major legislative reforms ongoing.


Federal Criminal Law Enforcement Policy.

Federal criminal law enforcement policy regarding cannabis offenses has always changed over time from one administration to another.

During the administration of Barack Obama, the Department of Justice issued guidance which was referred to as the Cole Memorandum that gave the federal prosecutors the instruction to focus their enforcement efforts relating to cannabis on specific enforcement priorities such as:

  • ensuring that cannabis was not distributed to minors
  • also making sure that the revenue from cannabis businesses does not flow to criminal organizations
  • They are to also ensure that in States where cannabis is considered legal, the cannabis business is not used to move any form of illegal substance.

Having the Cole Memorandum in place didn’t change the federal law regarding cannabis but it helped the federal government and the state government to work hand in hand to ensure the cannabis business is run accordingly and the businesses are not putting laws in their own hands.

In January 2018, a new Attorney General Jeff Sessions revoked the Cole Memorandum and instructed that federal prosecutors should enforce the federal law on cannabis which was considered illegal. CRB only had options of banking through, which provides credit facilities to the business owners.


Federal Law Relating To Cannabis Banking.

At the moment cannabis business can be said to have limited access to banking services, because many banks are worried about breaking the federal anti-money laundering law as well as other laws guiding transactions with the proceeds from the cannabis business.

There have been tons of reports stating that cannabis businesses are unable to obtain banking services or have their banking relationship cut off because they are in the cannabis business. To the knowledge of the public, major banks in the United States do not accept cannabis clients, even though the majority of the states in the United States consider cannabis legal, and the business is booming and growing fast.

The federal Financial Crimes Enforcement Network (FinCEN) reports that 563 banks and 160 credit unions were providing banking services to the cannabis business as of September 30th, 2019. There is a great increase from the numbers stated in 2018 just a year before, as of September 30, 2018, 375 banks and 111 credit unions were providing banking services to the cannabis business.

In the bid to solve the problem of the cannabis business not getting banking services, States that consider cannabis legal have studied possible ways to encourage the provision of banking services but no solution has been found yet.

It just boils down to, the only solution that can be lasting in solving this problem will have the federal state involved, either by amending the federal law regarding cannabis so that banks can now service cannabis businesses without the fear of breaking any federal law because that is the main reason why all these banks do not want to service cannabis business.