Sep 26, 2019
Industry Reacts to Passage of SAFE Banking Act

On Sept. 26 the U.S. House of Representatives passed the Secure and Fair Enforcement (SAFE) Banking Act, which would allow for cannabis-related businesses to use banking services. The bill, which was approved on a 321-103 vote with bipartisan support, now moves on to the Senate.

During the House’s debate, proponents of the bill said it would reduce public safety issues as cannabis-related business must currently operate as cash-only, thus making themselves targets for theft or other violent crimes. Opponents of the bill argued the Schedule 1 status of the drug must be addressed prior to other legislation being passed, given the patchwork of regulations that exist as states approved their own laws on medical and recreational cannabis use.

Here is a round-up of reactions from around the cannabis industry.

National Cannabis Industry Association:

For the first time in history, a standalone cannabis policy reform bill was brought before the House of Representatives for a vote and passed with an overwhelming bipartisan majority. The Secure and Fair Enforcement (SAFE) Banking Act of 2019, or H.R. 1595, was approved 321-103, including nearly half of voting Republicans, in a suspension vote on Wednesday.

Due to current federal laws and financial regulations, most banks are unwilling to risk prosecution or punishment to work with state-legal cannabis businesses and often ancillary businesses that service the cannabis industry. This forces many businesses in this space to operate almost entirely in cash, creating public safety issues for everyone involved, from businesses and their employees to tax collectors and regulators. These policies also hinder the efforts of regulators and law enforcement to effectively monitor the legal cannabis market. Financial services institutions are also unable to provide loans to people in the cannabis industry, which disproportionately impacts small businesses and marginalized communities with less access to personal wealth or investment capital.

The SAFE Banking Act as approved in the House would prevent federal banking regulators from punishing banks for working with cannabis- and hemp-related businesses that are obeying state laws. 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 capital for small businesses would be increased by allowing traditional lending from financial service provides, and regular reporting on loan practices involving women and people of color in the cannabis industry would be required.

Credit Union National Association:

“Today’s vote would not have happened without fierce, bold 360-degree advocacy from CUNA, Leagues and credit unions that made it clear that this bill is a solution to a problem that affects consumers, businesses and financial institutions around the country,” said CUNA President/CEO Jim Nussle. “While garnering bipartisan support for a cannabis-related bill seemed a big hill to climb, our message was heard loud and clear through Congressional testimony, letters and face-to-face meetings that helped impress upon policymakers the need for this bill. We hope the Senate will move forward in similar fashion and will engage with them going forward to get this bill across the finish line.”

American Bankers Association:

“By helping to provide clarity for the financial sector in those states where cannabis is legal, this bill will help banks meet the needs of their communities while reducing cash-motivated crimes, increasing the efficiency of tax collections and improving the cannabis industry’s financial accountability,” said ABA President and CEO Rob Nichols. “It will also ensure that businesses with indirect ties to the cannabis industry—including vendors, utility companies and law firms—won’t be needlessly forced out of the financial system.”

National Association of Professional Insurance Agents:

“Thirty-three states have medical marijuana laws and eleven states have legalized it for recreational use,” said Jon Gentile, Vice President of Government Relations for PIA National. “As such, it is common sense to protect insurance agents from prosecution for doing business with cannabis-related businesses in states where they are legal.”

“Insurance agents are neither enemies nor supporters of cannabis itself,” Gentile said. “They simply provide insurance to businesses that do business with legal entities.”

The SAFE Banking Act had applied only to banks until recently, when PIA National and other allies secured key parts of the PIA National-supported Clarifying Law Around Insurance of Marijuana (CLAIM) Act into the bill. The addition of key provisions of the CLAIM Act in the SAFE Banking Act will prevent federal criminal prosecution of and civil liability for agents, brokers, and insurers, and their officers, directors, and employees when engaging in the business of insurance in states that have legalized cannabis in some form.

“PIA National supports the SAFE Banking Act now that it includes the provisions from the CLAIM Act that protect insurance agents,” Gentile said. “We will continue to advocate for its passage and have already begun to work with Senators to urge the bill’s passage.”


“The historic passage of the SAFE Banking Act by the U.S. House of Representatives is an important first step in the process toward normalizing the cannabis industry’s ability to transact. If ratified, the bill will increase the safety of our operations for our patients, customers and employees by reducing the reliance on cash and promoting transparency. This is incredibly important legislation for an industry that represents approximately $50 billion in sales per year and is expected to grow to $80 billion in sales by 2030, according to Cowen. In addition to normalizing the industry, the bill also provides more access to capital for cannabis businesses of all sizes, which will support social equity in our industry. We applaud the members of the House for their leadership in passing this important bill with bipartisan support and look forward to gaining support in the Senate,” said Curaleaf CEO Joseph Lusardi.

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