Even though cannabis is legal in most states across the U.S., behind the scenes, dispensaries, manufacturers and producers all struggle with one common thing – commerce. Unlike food or clothing industries, banks are not handing out loans or facilitating seamless money transfers for marijuana-related businesses (MRBs). As a result, cannabis companies are struggling to get the funds and services they need to succeed and operate as a true business.

That’s where the SAFE Banking Act comes into play.

What is the SAFE Banking Act? First introduced in 2019, the SAFE Banking Act has continued to push the federal government along to consider better, safer commerce options for MRBs. However, years later, concerns still loomed from all sides of the industry that needed to be addressed. Thankfully, these issues were addressed this year, and in a monumental effort to advance the industry, a revised SAFE Banking Act was passed by a vote of 321-101.

The revised bill, which still needs to pass through the Senate, will create vital protection for financial institutions, from fines and other penalties, if they provide their services to legitimate cannabis-related businesses.

Why Do Banks Need Protection?

Due to cannabis being federally illegal, financial institutions’ hands are often tied when it comes to helping MRBs find the funds they need to operate and scale. This is because federal commerce regulators have a hawk’s eye on these institutions, and are ready to enact hefty fines and penalties.

What Restrictions Does the SAFE Banking Act Now Have?

The excitement around the SAFE Banking Act stems from its ability to prevent federal commerce regulators from implementing certain penalties, such as:

  • Terminating or limiting a depository institution’s access to deposit insurance or share insurance;
  • Prohibiting, penalizing, or otherwise discouraging depository institutions from providing traditional commerce services to a covered business;
  • Recommending, incentivizing, or encouraging a depository institution not to offer financial services to an individual or business entity because of their status as, or relationship with, a covered business; or
  • Taking adverse action on a loan made to a covered business

Why is the SAFE Banking Act So Important?
The cannabis industry has a lot of money tied to its name. In fact, it is estimated that in 2026, there will be $41 billion in cannabis sales in the United States alone. The problem is – a large portion of this money is handled in cash.

The safety of employees and businesses are at stake when banks do not allow MRBs to operate with the same financial framework as other industries. However, not only does the SAFE Banking Act ensure safety, it can also help MRBs sustainability in this competitive environment. Right now, it is extremely difficult to get a loan as an MRB. Which means in order to scale and properly market your company, cannabis businesses need to find outside investors, borrow money from friends and family, or potentially risk having to shut down altogether.

Without access to banks and its financial services, a legitimate cannabis company, even with a great business model, may be pushed to the brink of survival.

Financial Services to MRBs Right Now

The limited number of banks that do offer cannabis commerce programs, do so at an extremely predatory price. Confia affords MRBs the same commerce rights and privileges as any other industry, providing the safety, and accountability, these businesses deserve.

As a leading system that has been specifically designed to support the compliance and transactional complexity of the cannabis industry, Confia provides MRBs with streamlined access to integral cannabis business funding and commerce services. These services include automated compliance, deposit balances, access to lenders and affordable electronic transactions.

Skip to content