Banking Access for Cannabis Companies Will Remain Stymied with Federal Reclassification

Following the reported move by the federal government to reclassify cannabis as a Schedule III drug under the Controlled Substances Act, the American Bankers Association (ABA) said Congress still needs to pass the SAFER Banking Act, which would allow state-legal cannabis companies access to traditional financial services. 

In a statement, the ABA said that while it “takes no position on the legalization of cannabis, it’s important for policymakers to know that any potential decision to reclassify cannabis has no bearing on the legal issues around banking it.”  

“Cannabis would still be largely illegal under federal law, and that is a line many banks in this country will not cross. The solution is the bipartisan SAFER Banking Act, which would allow banks to provide services to the cannabis industry in those states where it’s now legal. Passing that legislation in Congress would address the ongoing legal limbo around cannabis banking, while enhancing public safety, tax collection and transparency.” — ABA in an April 30 statement 

In an interview with the Associated Press, Blair Bernstein said the decision by the feds to reclassify cannabis “has no bearing on the legal issues around banking cannabis.”    

“Cannabis would still be illegal under federal law,” Bernstein told the AP, “and that is a line many banks in this country will not cross.” 

Morgan Fox, political director for NORML, added that he doesn’t think the federal reforms will “have a demonstrable effect” on financial institutions with regard to cannabis banking. 

Last year, a Congressional Research Service report found that about 675 financial institutions are doing business with cannabis companies. 

“However, the depth and breadth of financial services that depository institutions are providing to marijuana businesses is unclear,” the report says. “It is also uncertain whether these depository institutions are serving businesses directly involved in cultivating and selling marijuana or are serving only entities indirectly involved in the marijuana business (e.g., landlords renting office space to marijuana businesses).” 

The House has passed a version of the banking reforms, then known as the SAFE Banking Act, seven times, while the legislation has never passed the Senate.