The governor of Missouri has signed an expansive public safety bill into law that contains provisions to facilitate access to financial services for state-legal marijuana businesses.
Currently, only a handful of banks across the country work with marijuana business owners due to cannabis’ federally illegal status, even in states that have moved to legalize marijuana sales.
As a result, many operate on a cash-only basis which, as well as inhibiting growth, puts businesses at greater risk of robberies.
“There’s this divide between the federal and the state perspective on the topic that puts banks in a kind of tricky position,” said Jackson Hataway, president of the Missouri Bankers Association.
Now, Missouri’s Department of Health and Senior Services (DHSS), which is charged with regulating the state’s cannabis program, is authorized to share information with banks looking to service marijuana businesses.
Previously, banks had to carry out this work in order to comply with federal financial guidelines, and very few were equipped or willing to take on the task.
“In lieu of doing our own inspections it’d be very, very helpful for us to be able to get this information from the Department of Health and Senior Services to make the program fluid and keep us in compliance with federal regulators,” said Jim Regna, CEO and founder of Triad Bank, to Missouri lawmakers in March.
As part of the new financial guidelines, all employees in Missouri’s marijuana industry must submit to a fingerprint background check.
Under the ballot proposal approved by voters in November to legalize adult-use cannabis, only marijuana business owners had to supply their fingerprints to the Missouri Highway Patrol for a background check.
As well as all employees of cannabusinesses, contractors and volunteers working with marijuana companies must also submit their fingerprints as part of a background check.
While the rule change had the support of the Missouri Cannabis Trade Association, many fear the new requirements could hinder the recruitment efforts of cannabis businesses at a time when the industry is experiencing rapid growth.
The long-term solution, for Hataway, is to pass the federal SAFE Banking Act which would allow banks and other financial institutions to service state-legal marijuana businesses without fear of federal reprisals. While it has been approved by the House multiple times, it has yet to receive a full hearing in the Senate.
“So we remain in the current quagmire we’re stuck in,” Hataway said, “where you have a lot of states like Missouri that have upward pressure from businesses to have a secure and safe banking environment. Because if they’re all cash, they’re very risky.”