Marijuana is a billion-dollar industry, and the vast majority of American bankers want in on it, according to a survey published Wednesday by Promontory Interfinancial Network, a finance tech company serving more than 3,000 banks across the U.S.
The survey found that 82 percent of surveyed bank executives support Congress passing a law allowing financial institutions to do business with cannabis companies, a practice that is restricted because marijuana is considered an illegal narcotic at the federal level.
Without access to banks, many cannabis companies, including growers and retailers, face a significant burden operating as cash-only businesses. For instance, some struggle to pay tax in states that have legalized marijuana.
One grower “holds his breath as he walks into the building” to pay his taxes, said Terra Carver, executive director of the Humboldt County Growers Alliance. The distance is “no more than 20 yards, but the fact that he was holding $350,000 (makes it) ... a public safety issue.”
Surveyors spoke with 453 bank presidents, chief executive officers and chief financial officers, most of whom represented community banks with assets less than $1 billion.
Paul Weinstein, a senior policy adviser with Promontory, said that he was both “sort of surprised and not surprised” by the findings.
“Bankers are a fairly conservative lot,” he said. “But at the same time they’re businesspersons and pragmatists.”
Weinstein said bankers can see that states are moving, gradually, toward a more marijuana friendly position — California Attorney General Xavier Becerra and 37 of his counterparts recently wrote a letter to Congress urging them to allow cannabis companies to bank.
California lawmakers also are considering a bill aimed at giving banks and credit unions the ability to offer limited services to cannabis companies.
Unsurprisingly, bankers in the Western United States showed the most support (89 percent) for marijuana banking; Alaska, California, Colorado, Oregon and Washington all have legalized recreational cannabis use, and several other western states have recognized medical marijuana.
In the Midwest, that number was 85 percent, while in the Northeast it was 79 percent.
Even in the South, where marijuana legalization has made little headway, 76 percent of bank executives favor giving access to cannabis companies.
Weinstein said this is a meaningful turn of events. If Congress loosens the restriction on cannabis banking, banks across the U.S. would likely open up their services.
“We’re talking about leadership at the banks, not rank and file folks. These are the folks that are in charge,” he said.