The Senate Banking And Insurance Committee unanimously authorized a bipartisan banking protection bill in Pennsylvania in the medical cannabis industry. A banking protection bill is an act that enhances financial stability (in this case, in the medical cannabis industry) by increasing accountability and transparency within the cannabis banking sector, which protects consumers from abusive financial services activities, among other things.
Although Congress continues to procrastinate on federal marijuana banking and policy reform, as do the majority of State governments on local reforms, we at Beard Bros would like to acknowledge all wins for the cannabis industry, both large and small.
Ins And Outs Of The Pennsylvania Banking Protection Bill
The Senate Banking And Insurance Committee, chaired by Sens. John DiSanto and Sharif Street (panel chair and minority chair, consecutively) approved the bill which will assist in preventing state authorities from penalizing banks and insurance companies for partnering and working with state-legal medical cannabis businesses.
It’s important to note that the bill will not provide immunity to the banking sector at a federal level because cannabis is still a federally controlled substance in the eyes of national law. This is frustrating for banks, insurance companies, and medical marijuana businesses alike as it causes a continuation of hesitancy for institutes of finance to work with clients in the cannabis industry.
This proves to be a loss of business for banks and insurance companies while hindering the growth and financial protection of the legal marijuana industry. Protected banking in the state-legal cannabis sector eliminates public safety concerns while also providing the potential to develop our economy and, as a result, cut medicinal cannabis patient costs.
Financial services may be given to or for the aiding of legitimate cannabis-related businesses and their associates by a bank or insurance institute of finance that is allowed to conduct business in the state. However, specifications are made that this is not required of them. Regardless, near the end of 2021, the number of banks reporting working with marijuana businesses increased once more.
Possible Effects And Outcomes Following The Bill
The Committee’s decision to grant state-level securities could possibly increase pressure on Congress to pass a federal change.
Allowing responsible banking is an act of public safety, meaning that less harmful methods of money transmission will be available. We need to avoid and diminish instances of people carrying excessive cash, and both the state and federal governments need to provide and enforce necessary procedures which will allow this to be prevented.
Permitting safe banking is also a move that will improve accessibility, by upping the quality of access that patients will have. The federal government and the commonwealth members have an obligation to take the necessary steps to enable this.
[Related Reading: Payment Options in Legal Cannabis are Shaky at Best]
Cannabis Businesses Deserve More
States should be assertive and continuous in taking proactive steps to open and increase the legal cannabis industry while applying pressure on Congress to follow suit. Their procrastination and often-times irrational justification in regards to cannabis policy advancements are growing older and more frustrating by the day.
Ed Perlmutter, the SAFE Banking Act sponsor Representative, is determined to make progress toward safe banking in the cannabis industry before stepping down at the end of this session. He’s even made it a point to mention the reform bill during hearings on purportedly seemingly unrelated or broader-ranging legislation.
It is imperative that states apply pressure on Congress to make the policy changes and begin to lift restrictions on the cannabis industry in all of its aspects, because, as Perlmutter so eloquently put it, “Nothing sails through the senate.” It is due to consistent efforts and persistent pestering of those individuals in positions of power (and those not) that has allowed the legal cannabis industry to advance to this point.