Cannabis industry: Move forward with SAFE Banking Act

Cannabis Industry Urges Senate Banking Chairman to Move Forward with SAFE Banking Act

Sen. Mike Crapo released guidelines for cannabis banking reform legislation Thursday that would undermine the intent of proposed reforms and hinder the effective operation of state-legal cannabis programs 

Safe banking act explained

WASHINGTON, D.C. – The chairman of the Senate Banking Committee alarmed advocates of cannabis banking reform late Thursday afternoon when he released a set of guidelines and concerns about legislation that the Senate is currently considering. Sen. Mike Crapo (R-ID) released a statement laying out a series of restrictions that he would like to see included in any cannabis banking bill that moves forward in the Senate, including only allowing banks to work with businesses that produce cannabis products containing 2% THC or less, which would disqualify the vast majority of the legal cannabis businesses already operating in most U.S. states. He also voiced his opposition to the House-approved SAFE Banking Act.

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“We appreciate the chairman’s recognition of the need for reform and his willingness to consider this issue, but the guidelines he is suggesting do not reflect the realities of modern cannabis programs on the books in most states and would only exacerbate the current problems created by lack of banking in the cannabis industry,” said Aaron Smith, executive director of the National Cannabis Industry Association.

“The SAFE Banking Act, which was approved by an overwhelming bipartisan majority in the House, is narrowly tailored to address the ongoing issues of public safety, transparency, and fair access to capital. We are confident that the bill being considered by the Senate is the simplest, most effective solution and urge the chairman to hold a markup as soon as possible so we can allay any concerns he may have. Muddying the waters with ancillary issues will only delay passage of this straightforward and necessary reform.”

The Secure and Fair Enforcement (SAFE) Banking Act of 2019, or S. 1200, would prevent federal banking regulators from sanctioning banks for working with cannabis related businesses that are obeying state laws, halting their services, taking action on loans made to those businesses, or limiting a depository institution’s access to the Deposit Insurance Fund. The bill would protect ancillary businesses that work with the cannabis industry from being charged with money laundering and other financial crimes, and requires the Financial Institution Examination Council to develop guidance to help credit unions and banks understand how to lawfully serve cannabis businesses. Access to banking services would also allow small businesses and marginalized communities to have greater access to traditional sources of capital when operating in the cannabis industry.

The SAFE Banking Act was approved by more than two thirds of the House of Representatives, including nearly half of voting Republicans, in September. The Senate version was introduced in April by Sen. Jeff Merkley (D-OR) and Sen. Cory Gardner (R-CO) and currently has 33 bipartisan cosponsors. In July, Sen. Crapo signalled his willingness to consider this issue by holding a hearing in the Banking Committee, and has since made several statements expressing his desire to move cannabis banking legislation forward in the upper chamber.

Cannabis is legal for adults in 11 states as well as the District of Columbia and the territories of CNMI and Guam, and 33 states as well as several territories have comprehensive medical cannabis laws. The substance is legal in some form in 47 states. Sen. Crapo’s home state of Idaho is one of three states that do not allow cannabis in any form. Three states bordering Idaho have regulated cannabis for adults, and two of its neighbors have medical cannabis programs.

“We look forward to working with Sen. Crapo and the rest of the Senate to pass cannabis banking legislation that is actually effective,” continued Smith. “The current language of the SAFE Banking Act is the best way to ensure the safety of legal cannabis businesses and their employees, help regulators and law enforcement provide oversight for the cannabis market, and make sure that the people most harmed by prohibition have access to the capital necessary to participate in this challenging industry.

“NCIA strongly opposes Sen. Crapo’s position on this issue and will be coordinating with stakeholders in the coming days to submit comments and objections to the chairman’s office. The cannabis industry has created more than 200,000 jobs and has generated considerable revenue since states began legalizing cannabis for medical and adult use. This industry is an economic driver for the country and Sen. Crapo’s approach would inflict irreversible damage to the industry.”


The National Cannabis Industry Association (NCIA) is the largest cannabis trade association in the U.S. and the only organization broadly representing cannabis-related businesses at the national level. NCIA promotes the growth of a responsible and legitimate cannabis industry and works toward a favorable social, economic, and legal environment for that industry in the United States.

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