As discussed in our Cannabis Banking Guide, the criminal classification of marijuana on a national level often prevents cannabis business owners from working with most major financial institutions. Under current law, banks that provide services to cannabis businesses can be subject to criminal prosecution. Even national credit card companies like Mastercard and American Express can face penalties if customers use their services at a dispensary or other cannabis related shop.
As you might have guessed, the reluctance of most financial institutions to do business with cannabis companies creates numerous issues for dispensaries, cultivators, and other ancillary businesses. Entrepreneurs often struggle to raise capital as they don’t qualify for loans that business owners in other industries might receive.

Where to get help with cannabis banking
Green Space Accounting has experience helping companies navigate the cannabis industry’s complicated banking landscape. If you’d like more information on our services, you can contact us today — we’ll explain how Green Space Accounting can help.
Cannabis Banking Restrictions and Public Safety
The lack of banking options has even been dubbed as a public safety issue as these businesses are forced to operate as cash-only despite processing thousands of dollars worth of transactions a day. This can cause businesses, specifically dispensaries, to become a target for theft or other violent crime. Dispensaries often result to spending massive amounts of capital on
security personnel, cameras, and heavy-duty safes in order to feel secure.
The SAFE Banking Act is a direct response to the issues mentioned above. On April 19, 2021, this act passed the House by a vote of 321 to 101, but the bill currently sits in the Senate. Keep reading to learn why this bill is an exciting step-forward for entrepreneurs and current business owners.
What Is The SAFE Banking Act?
The SAFE Banking Act is a bill that has been brought to Congress on numerous occasions but never passed. However, with cannabis becoming legal in more states and medical marijuana receiving approval from big pharma companies, the time seems ripe for this legislation to be passed into law.
In short, this bill would allow banks to provide financial services to cannabis businesses without the fear of federal prosecution. This is huge for operations like dispensaries as they can now easily accept credit card payments and start functioning the same way that businesses in more traditional industries would. The co-sponsors of the Senate legislation believe that passing this act will improve public safety and support small businesses.
What Does the SAFE Banking Act Do?
Should the SAFE Banking Act of 2021 pass, key aspects will include:
- Prohibiting federal banking regulators from restricting or penalizing a financial institution for providing services to a legitimate cannabis-related business.
- Establishing that “proceeds from a transaction involving activities of a cannabis-related legitimate business or service provider” are not “proceeds from an unlawful activity”.
- Prohibiting federal regulators from terminating or limiting depository insurance solely because a financial institution provides services to a cannabis-related legitimate business.
This act also protects hemp-related businesses, like CBD businesses. This is particularly important as retailers with hemp products like CBD or delta-8 have found themselves in a grey area as far as legality. It is uncertain whether this act will successfully pass in the Senate.
Key Takeaways
This legislation would bring about significant changes in how banks can do business with cannabis companies. It shifts the conversation from whether or not they should be doing so to what exactly those regulations will look like. While the future looks promising for entrepreneurs eager to enter the cannabis space, it’s important for business owners to maintain compliance with current legislation until this act passes.
Looking after the financial side of your cannabis business can be complicated, time-consuming, and stressful. Green Space offers complete, personalized accounting solutions for cannabis businesses of any size. Whether you’re looking for cash flow management, business planning, or internal controls, our team can help you achieve peace of mind when it comes to your company’s finances and compliance. Click below for a free 30-minute consultation!

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