Missouri Business Alert recently published an article on one of the cannabis industry’s most pressing concerns—limited access to traditional financial services. Providing expert commentary on this complex issue is Smith Patrick CPA’s very own Sarah Bantz, a senior accountant specializing in cannabis financing.
A Milestone in Cannabis Legislation
The Missouri Business Alert article outlines the implications of the Secure And Fair Enforcement Regulation (SAFER) Banking Act, which recently received approval from the Senate Committee on Banking, Housing and Urban Affairs. The SAFER act aims to provide legal cannabis businesses with access to traditional financial institutions, such as bank accounts and small loans. While this may sound like a no-brainer for other industries, it’s groundbreaking for cannabis.
The Expert’s Take
Sarah, representing Smith Patrick CPA, sheds light on the banking predicaments faced by cannabis entrepreneurs. Dispelling the myth that the cannabis industry is “unbanked,” Sarah clarifies that it is actually “underbanked,” meaning it has some, albeit limited, financial options that often cause complications for business operations.
Navigating the Payment Conundrum
Sarah highlights the industry’s creative workaround solutions, like PIN Debit – an electronic funds transfer method, and ACH accounts – a way for customers to pay directly from their bank accounts. However, these options come with their own set of limitations. She points out that many customers remain hesitant to share their bank information for retail purchases and PIN Debit is no longer a permitted payment method for the industry.
A Free Market Challenge
Sarah reveals that Missouri currently has only five financial institutions willing to serve the cannabis industry. This lack of choices inhibits a free market and often leaves businesses tethered to financial services that may not meet their needs. “If you’re using a bank and it’s not providing the services that you really want or need as a business, you really have nowhere else to go,” she says.
Waiting for the Green Light
The SAFER Banking Act still has hurdles to clear, including Senate and House approval. Bantz, echoing the sentiments of many in the industry, notes, “It’s overdue. We needed it years ago.”
In summary, Sarah Bantz’s expertise presents a nuanced picture of the challenges and opportunities that lie ahead for cannabis businesses in the realm of financial services. While the SAFER Banking Act promises a brighter future, the industry is yearning for actionable changes today.
To delve deeper into this topic, read the full article on Missouri Business Alert.
To check out our other articles on business topics, click here.