Alternate Routes

Banking is a continual problem in the cannabis industry, as the options for safe cannabis banking are stuck behind a federal wall of illegality. Technically, banks that deal with legalized recreational cannabis businesses could be in violation of federal law. Until the substance becomes legal nationwide, federal and nationwide banks are obligated to uphold the laws that apply to the nation as a whole, instead of state laws.

However, states like Oregon have recently become a little more cannabis business friendly, with local community credit unions opening their doors to cannabis entrepreneurs and store owners. Without the possibility of opening up a business bank account, dispensary owners and grow operators have had to deal with all transactions on a cash basis. This doesn’t just mean consumers have to pay in cash; it means all the money involved in running the business has to be in cash as well. Cannabis businesses cannot make large deposits and withdrawals from a bank account, instead there are large sums of money in office safes and employees paid in cash.

This has been a huge problem in states with legalized cannabis, and it has left business owners and those in the industry in very dangerous and compromising situations. Credit unions in Oregon like Maps Credit Union, based out of Salem, work with cannabis businesses. They allow owners to open business accounts and handle their cash flow like any other business owner. This is a ray of hope for many people in Oregon who are looking to get into the cannabis industry but are afraid of working with so much cash. Timberland is another bank serving Oregon and Washington canna-businesses, with the closest branch to Portland way down in Albany. Until federal banks allow dispensaries and growers to bank at their facilities, Portlanders are left having to drive long distances to make cash deposits and do everyday business banking.

Washington State lawmakers have gone to great lengths in the past few years to try and create avenues in banking for canna-businesses. Scott Jarvis, Washington State’s head banking regulator, has been a major advocate for those in the cannabis industry. He has stepped up to ensure that banks allow accounts to be opened for all types of business. Although it is more expensive and inconvenient for everyone involved, having cannabis businesses operate through local banks could actually be beneficial for the state. More of that sweet cannabis revenue is being circulated through the local economy instead of going to the big banks. Small banks in Oregon are seeing much more cash, with an increase of cannabis consumers and workers paying in cash since legalization, banks are seeing much more of the green stuff since legalization. This is a big change, for bankers especially, who over the past 10 years have been converting mostly to debit transactions and direct deposits.

Many of the local state-chartered credit unions working with cannabis businesses aren’t very out in the open about their services, but those in the industry have gotten word. Being able to do business with a regular bank is already keeping many owners and workers safe from robbery and assault.

As an alternative, apps have been coming out as a possible solution for the time being.  Colorado-based company called CanPay has launched an app in Colorado, Oregon and Washington for those who own cannabis businesses and want to avoid working with so much cash. The app allows consumers to pay dispensaries directly through their mobile devices. Instead of money changing hands, it can de deposited directly into the account of the store owner. Over a dozen retailers are already working with the app, along with a few banks. It’s a slow start and a frustrating process for dispensary owners, grow operators, and all workers in the cannabis industry. But we can rest assured that there are advocates in Oregon, Washington and other states across the country, working to help those in the cannabis industry run their businesses more efficiently and safely.