A bill currently making its way through Congress would make legal weed a little more affordable for consumers.
One of the most promising cannabis related bills currently sitting in Congress is the Secure And Fair Enforcement (SAFE) Banking Act, which was introduced by Senators Jeff Merkley (D-OR) and Cory Gardner (R-CO). If passed, the bill would allow banks, credit unions, and insurance companies to provide financial services to legal cannabis businesses without fear of repercussions from the federal government.
Since cannabis is still prohibited under federal law, any financial institution that does business with the industry could be charged with engaging in criminal activity. Even though 10 states allow recreational use and another 23 have legalized medical marijuana, all state-licensed cannabis businesses are illicit drug traffickers in the eyes of federal law, so it's not surprising that banks are leery of working with them.
But that could change with the SAFE Banking Act, which would not only allow financial institutions to treat members of the cannabis industry like any other business but also make cannabis cheaper for the consumer.
Right now, the few financial institutions that deal with the marijuana industry charge their cannabis clients much bigger fees than they do for clients from other industries. Those institutions are also few and far between, meaning that businesses often need to travel long distances just to conduct banking.
"It's not a very competitive marketplace," David O'Brien - Executive Director of the Massachusetts Cannabis Business Association - told The Boston Globe. "Every other type of business is able to bank within its region, and more often than not, within the same town."
Because of that extra hassle and the additional fees, licensed retailers have to sell cannabis at higher prices in order to recoup the cost of doing business, according to Brandon Pollock, CEO of the Massachusetts dispensary Theory Wellness. Pollock says that if the feds could find a way to make banking more accessible and affordable for dispensaries, the cost of cannabis would drop substantially.
"Getting access to more conventional financing would let us grow much quicker, and that would lower the prices we offer to consumers, too. Marijuana prices in Massachusetts are high, in part, because marijuana businesses have such high borrowing costs."
So passing the SAFE Banking Act would be a win for consumers as well as cannabis businesses, who would no longer need to drive duffel bags of cash over to tax collectors in order to avoid running afoul of the IRS.
Right now, it looks like the SAFE Banking Act stands a decent chance of passing. It has 20 bipartisan sponsors in the Senate, it recently made it through a key subcommittee, and even Treasury Secretary Steven Mnuchin has voiced support for the bill.
If it does pass, legal cannabis might actually be able to compete with the black market in legal states. Now wouldn't that be a treat?