Friday, June 1, 2018

California could soon open the floodgates for cannabis financing as Senate passes bill to open first official cannabis bank

Despite the fact that the Federal Government has not seen fit to challenge state's who have legalized medicinal or recreational marijuana, this has kept the banking industry from accepting monies derived from this industry out of fear of Federal reprisal.

But this may soon be changing as the California State Senate has passed Bill 930 which would allow the creation of a cannabis dedicated bank.

California cannabis consumers and industry operators could enjoy a safer, more regulated legalized industry in the future, thanks to the passage of a bill to create the world’s first marijuana-focused bank. 
Senate Bill 930 to set up a state charter bank for the cannabis industry survived a crucial floor vote in the California Senate Thursday. Friday is the deadline for all California bills this year to clear their house of origin. 
California’s cannabis industry is expected to generate an estimated $10 billion in retail sales per year at full capacity, but the industry struggles to maintain bank accounts due to federal marijuana prohibition. Federal regulators have told banks to proceed with caution when banking state-legal cannabis funds. The vast majority of the banking system refuses to serve the legal industries in nine states, leading to all-cash transactions and increased risk of robbery, among other problems like paying employees and taxes. - Leafly
Establishing a state run bank would also solve a number of other issues for California and other locales that have legalized cannabis sales and use.  By this we mean it would help eliminate businesses storing large sums of money in unregulated platforms like cryptocurrencies, and could ensure taxation revenues would be delivered swiftly and in full.

However the establishment of a dedicated cannabis bank would also create a lending industry to help build more businesses and create more jobs.  And in an industry expected to one day soon reach revenues of over $100 billion per year, cultivating its expansion versus finding ways to hinder it is a win-win for everyone involved. 


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