Business
A New Solution to Cannabis Banking is on the Horizon
Ever since the birth
of the legal and medical cannabis industry, dispensaries and other cannabis
businesses have struggled with how to manage money and deal with banking. Banks
that worked with the
[dropcap class=”kp-dropcap”]E[/dropcap]ver since the birth of the legal and medical cannabis industry, dispensaries and other cannabis businesses have struggled with how to manage money and deal with banking. Banks that worked with the cannabis industry have come and gone, and just when cannabis businesses think they might have found something that works, the bank or credit union goes bottom-up or drops them, leaving them out-of-luck and left with unmanageable piles of cash on their hands once again.
However, a new solution to this ongoing problem might be on the horizon. Link to Banking, developed by a cannabis finance group called Kind Financial, is an app that allows banks to work with cannabis businesses. The people who developed it are bankers and specialists in combatting money laundering and fraud, and their team even includes an ex-member of the Financial Crimes Enforcement Network.
How will this help facilitate communications between banks and businesses, so that the cannabis industry won’t be left out of the financial loop?
It tracks the spending and income of cannabis businesses to insure that all standards are being adhered to, and the dispensary is not doing anything with their finances that is not above-board.
“Link to Banking has the first and only system that provides banks the tools to monitor and track customer activity to ensure Bank Secrecy Act obligations are maintained,” Link to Banking Chairman Tom Fleming stated in a press release“Now, with complete transparency and real-time reporting solutions, our program should ease fears of enforcement actions.”
“Link to Banking’s solution provides banks a unique system that uses data derived from the dispensary’s POS and kiosk software,” stated Robert Casares, the President of Link to Banking. “The program will have the look and feel of an Anti-Money Laundering system which banks use today, complete with custom rule sets and parameter settings to monitor for any discrepancies or suspicious activity related to sales, inventory, and customer transactions.”
While it’s a bit of a shame that the cannabis industry still needs to be under such close
scrutiny while trying to operate legitimately, this is at least a good first step towards actual banking solutions. If banks are willing to take this leap of faith and dispensaries feel that having their expenses tracked in order to gain access to banking services is a good trade-off, we can expect to this new option adopted in due time.
