The Attorneys General for Pennsylvania and New Jersey are among dozens asking congressional leaders to allow legal marijuana businesses to use the banking network.
Industry analysts estimated that in 2017 the U.S. cannabis industry generated more than $8.3 billion in sales. Because the federal government considers marijuana illegal, nearly every dollar generated was handled outside the federally regulated banking system. More importantly, every transaction was handled in cash.
By 2025, industry analysts expect revenues to balloon to $25 billion. Marijuana is fully legal in at least 10 states and it is legal for medicinal use in 33 states and the District of Columbia.
The billions in marijuana cash — circulating from businesses to local financial institutions that accept weed money — is widely considered a public safety risk.
Pennsylvania AG Josh Shapiro and New Jersey AG Gubir Grewal were among 38 attorneys general who signed a letter dated Thursday to request that Congress pass the SAFE Banking Act. The proposed law would provide legal protections to financial institutions who offer banking services to the marijuana industry in states where cannabis is legal.
“An effective safe harbor would bring billions of dollars into the banking sector, enabling law enforcement; federal, state and local tax agencies; and cannabis regulators in 33 states and several territories to more effectively monitor cannabis businesses and their transactions,” the letter stated.
Without a safe harbor provision, all legal marijuana transactions must be conducted in cash. A handful of banks — usually state chartered institutions or credit unions — accept cash proceeds but charge marijuana growers and retailers up to $15,000 a month, per account, to handle it. A law would open the industry to the use of credit cards.