Cannabis Banking Act Passes House: Bipartisan Support

SAFE ACT Advances: Banking Access for Cannabis Businesses

The U.S. House of Representatives has approved significant legislation designed to alleviate constraints on the cannabis industry. The SAFE ACT (Secure and Fair Enforcement) banking act establishes protections for financial institutions engaging with cannabis operators.

Should it gain Senate approval and the President’s signature, this legislation would enable the cannabis sector to utilize conventional banking services, a resource currently largely inaccessible and necessitating substantial cash transactions.

Previous Attempts and Current Status

This marks the fourth instance of the SAFE ACT’s passage in the House. An earlier iteration of the bill secured House approval in 2019, but ultimately stalled within a Senate committee, failing to reach then-President Trump for consideration.

The present version of the SAFE ACT offers federal protection to banks and credit unions from prosecution when conducting business with cannabis companies operating in full compliance with their respective state regulations.

Impact on Financial Institutions

This protection would unlock traditional capital streams from financial institutions, which have been previously unavailable due to the ongoing federal illegality of cannabis.

Consequently, banks would be empowered to collaborate with operators within states where cannabis is legally sanctioned.

Current Legal Landscape

Currently, 36 states, four territories, and the District of Columbia have legalized cannabis for medical applications.

Furthermore, recreational cannabis use is permitted for adults in 18 states, two territories, and D.C.

Bipartisan Support and Future Outlook

The bill garnered substantial bipartisan support in the House, passing with a vote of 321-101.

Prior to the vote, a letter endorsing the legislation was submitted to House leadership by 20 state governors, one U.S. Territory, bankers representing each state, and a coalition of state treasurers.

Given the broad support from both political parties, advocates and industry analysts express increased optimism regarding the bill’s prospects for passage in the Senate and subsequent approval by President Biden.