marijuana banking

The House of Representatives passed the America COMPETES Act of 2022, which includes provisions for easing marijuana banking.

On Friday, the language of the Secure and Fair Enforcement (SAFE) Banking Act was added as an amendment by the bill’s sponsor, Rep. Ed Perlmutter (D-CO). The bill would allow banks and other financial institutions to work with state-licensed cannabis-related businesses, which they are currently discouraged from doing.

“I will keep pushing to ensure #SAFEBanking remains in the final #AmericaCOMPETES package negotiated with the Senate,” Perlmutter tweeted. “#SAFEBanking remains the best opportunity to enact some type of federal cannabis reform this year & will serve as the first of many steps to comprehensive reform.”

This is the sixth time the House has advanced SAFE Act marijuana banking reform as an amendment or as a stand-alone piece of legislation.

“It is imperative for the interests of public safety, transparency, and the economic viability of small cannabis businesses that this legislation is approved as soon as possible,” said NORML Political Director Morgan Fox. “The fact that the people’s chamber has approved this measure in various forms so many times is a clear indicator of where voters stand on this issue.”

He argued inaction “puts workers and customers at risk of violence, makes it harder for regulators to accurately track cannabis revenue, and perpetuates the high costs and lack of access to capital that are increasingly widening the gap between large and small businesses in the cannabis space when it comes to their chances to succeed.”

“The SAFE Banking Act is only the first step toward making sure that state-legal marijuana markets operate safely, efficiently, and fairly. But unfortunately, the sad reality is that those who own or patronize these currently unbanked businesses are still nonetheless recognized as criminals in the eyes of the federal government and by federal law,” Fox added.

Thousands of state-licensed cannabis businesses have problems finding a bank willing to business with them due to federal restrictions. The banks are afraid of getting caught being associated with cannabis. Thus, many cannabis companies have problems accepting credit cards, depositing revenues, accessing loans, and writing checks to meet payroll or pay taxes.

The Senate thus far has not voted on the SAFE Banking as a stand-alone bill nor permitted the SAFE marijuana banking language to be removed as an amendment from other legislation in conference committee to keep the federal government functioning.

A survey by Whitney Economics of 396 licensed cannabis companies reported that over 70 percent of respondents cited a “lack of access to banking or investment capital” as their top business challenge, ranking far above other challenges, such as onerous state regulations or competing with the unregulated market.

Marijuana Banking Versus Social Justice

While the cannabis industry is focused on issues impeding financial prosperity, social justice and criminal justice reform advocates are unhappy at the legal repercussions that remain and its disproportionate impact on Hispanics and African Americans.

Senate Majority Leader Chuck Schumer (D-NY), along with Senators Cory Booker (D-NJ) and Finance Committee Chair Ron Wyden (D-OR), have said they want to push a social justice-centered bill. Still, they have yet to introduce such a bill formally. However, at a press conference on Friday in New York City, Schumer said he would so in April.

Schumer tweeted on Friday that “Comprehensive federal marijuana legalization with justice for the communities most impacted by the War on Drugs—especially communities of color—is a Senate priority. With marijuana justice, the people are on our side. We will move forward.”


Since the movement for cannabis legalization centered on social justice won a large victory in New York, Schumer has actively pushed a similar policy message.

“We don’t want the big boys to come in,” he said last year. “After all the pain that’s been occurring in communities like the one you represent in Brooklyn, where I’m from, to have the big boys come in and make all the money makes no sense.”

Schumer thus is interested in keeping the alcohol and tobacco industries from dominating the nascent cannabis market.

Those who have fought for a cannabis industry centered on small businesses owned by those most impacted by the War on Drugs are especially afraid of such a thing occurring.

If President Joe Biden used his authority to deschedule cannabis, the SAFE Banking Act would not be needed. Given that Biden was an ardent proponent of the War on Drugs and is dealing with a global pandemic and threats of war from Russia, it is unlikely he will do so.

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