Many Cannabis companies continue to be "unbanked"

Due to lockdowns and stay-at-home orders as well as legalization, the US cannabis industry posted record sales of $ 17.5 billion last year, an increase of 46% from 2019. This year, sales are expected to jump more than 20% expected, but companies have another problem ... They are bursting at the seams with cash that they have nowhere to put as they remain locked out of the banking system. Cannabis is legal in most states but remains illegal at the federal level, which means that most state-regulated banks will not serve the industry fearing various civil and criminal problems. Many banks and financial institutions don't even want to touch the industry, forcing cannabis companies to work with cash or use smaller financial institutions like credit unions. Given their limited options, roughly 70% of cannabis companies resort to the cash operation. According to a report from research firms Headset.io and New Frontier Research, U.S. cannabis companies are dealing with about $ 10 billion in cash, and to move and use it they have to get pretty creative. However, cash creativity is not something the tax office appreciates, so everyone is at risk here. Burying profits in cash in the backyard or transporting them in the trunk to pay suppliers, however, could soon come to an end. In the past few months, US authorities have begun to take steps to remove barriers to the development of a national cannabis industry. Last month the US House of Representatives passed the SAFE Banking Act, which would allow banks to provide services to cannabis companies in states where it is legal. The SAFE Banking Act of 2021 will now go to the U.S. Senate, where Senate Majority Leader Chuck Schumer previously indicated his support for the Cannabis Banking Act, along with various other cannabis policy reforms. The SAFE Banking Act was introduced back in 2019 but died in the Senate after it was passed in the House of Representatives. In February, three top Senate Democrats, including Schumer, announced a push to pass comprehensive legislation this year that would end marijuana bans at the federal level. Schumer, Senator Cory Booker from New Jersey and Ron Wyden from Oregon said they would publish a draft on "how best to legalize and regulate cannabis and the cannabis trade in post-prohibition America". The Senators stressed that passing the legislation would be a priority for the Senate. Senate Chairman Schumer reiterated that he hopes to see an end to drug prohibition by April next. Fifteen states and Washington, D.C., have now legalized recreational marijuana for adults over the age of 21. Thirty-six states currently allow the medical use of marijuana, while 15 states have no laws that allow marijuana. A few other states were also preparing to legalize last year; However, the great bureaucratic effort and social distancing prevented any voting processes. About 68% of Americans are currently in favor of legalizing marijuana, which is a record high, while the legal cannabis industry market topped $ 13.5 billion in 2019 and hit $ 19.7 billion last year. In its new study, New Frontier Data predicts US cannabis sales will reach $ 35 billion by 2025.