Why it matters: The latest version of the SAFER Banking Act has cleared the Senate Banking Committee, bringing cannabis companies one step closer to opening accounts with federally-insured banks. This legislation, if passed, would provide legal protections for financial institutions to serve the cash-dependent cannabis industry, allowing businesses to open bank accounts, access loans, and accept debit cards as payment. It could also enhance safety for cannabis sector employees who currently face the risk of violent crime due to operating with cash.
What they are saying: Senate Banking Committee Chairman Sen. Sherrod Brown emphasizes that cannabis banking is part of a broader conversation about marijuana policy, including addressing the damage caused by the war on drugs and ensuring access to marijuana for medical purposes. The senators who submitted the bill highlight the importance of providing traditional financial services to legal cannabis businesses and preventing banks from closing accounts due to reputational risk. On the other hand, opponents argue that the bill primarily benefits the wealthy and does not sufficiently address criminal justice reform.
The big picture: The advancement of the SAFER Banking Act reflects ongoing movement at the federal level regarding cannabis. The Department of Health and Human Services has recommended rescheduling cannabis from Schedule 1 to Schedule 3, a decision currently with the DEA. A congressional report suggests that the DEA is likely to recommend rescheduling, but a separate bill would require congressional approval for rescheduling. These federal developments occur amidst a potential government shutdown related to a spending bill, which could further delay progress on cannabis-related matters.
What to watch: The SAFER Banking Act now moves to the Senate Floor, where it will face additional hurdles and potential amendments. It will require 60 votes to pass in the Senate and will then proceed to the Republican-controlled House of Representatives. The bill may face opposition from Senate Republicans and House Republicans. Additionally, it is crucial to monitor the progress of other cannabis-related federal initiatives, such as the potential rescheduling of cannabis by the DEA and the potential government shutdown.
Take: The advancement of the SAFER Banking Act is a positive development for the cannabis industry. By allowing cannabis companies to access traditional financial services, this legislation could improve safety, increase access to capital, and foster the overall growth and legitimacy of the industry. However, it remains to be seen how Senate Republicans and the GOP-controlled House will respond to the bill, and potential opposition from these factions could pose challenges to its passage.
