New York recently awarded five medical cannabis businesses licenses to operate in the state. Despite official recognition, the winners will most likely have a hard time finding a financial institution to provide services. Although the Obama administration vowed to not prosecute merchants who operate lawfully, there is still too much ambiguity in federal laws in regards to responsibility and regulations for banks. Currently, regulations state that banks are responsible for monitoring cannabis accounts and ensuring compliance. Banks are also required to report any suspicious activities. Neglect to monitor cannabis accounts could result in severe punishment.
A handful of major banks like TD Bank, Key Bank, Wells Fargo, PNC Bank, and JP Morgan Chase have stated that they will not do business with the marijuana industry in New York or anyplace else unless the federal government gives more clarity.
This leaves the five licensees in New York with few opportunities with the big boys. However, some of the licensees are planning to bank with smaller institutions.
Columbia Care believes they will find a banking service soon that will give customers a variety of payment processing options like ATM or debit cards.
Empire State Health Solutions, a second licensee, says it is currently finalizing a banking deal. While another licensee, PharmaCann, is “in discussion” with New York banks. All 3 licensees declined to identify which banks they’re negotiating with.
As the market for medical and recreational marijuana grows, the needs for larger institutional services becomes more real. That’s why companies that manage to obtain licenses are fighting hard to do business with major banks as seen in New York, Nevada, Colorado, and California. Despite small gains in the state to state fight, all merchants agree that the market will only reach its full potential if the federal government makes a cohesive policy on banking with cannabis merchants.
Marijuana Merchant Account (MMA) offers a variety of marijuana payment solutions like debit cards, credit cards, checks, and more. Don’t wait on the federal government or big banks to support your merchant account.
Call 1-800-466-1809 or click below for Marijuana Payment Solutions from MMA