Players in the cannabis space are cautiously optimistic after the House of Representatives approved a wide-ranging coronavirus relief bill containing text from the Secure and Fair Enforcement (“SAFE”) Banking Act. For the longest time, players in the cannabis space have been unable to access banking services due to cannabis’ status as a Schedule I drug, forcing them to rely on cash-only transactions. Not only does this put them at risk of theft and burglary, but it also makes social distancing during the pandemic almost impossible.
Passed by the House last year but held in limbo in Senate, the SAFE Banking Act would protect banking institutions and allow them to serve cannabis businesses without fear of federal reprisal.
This is the second time this year that the House has inserted cannabis banking language in a Coronavirus relief bill. But while cannabis banking is an issue that’s dear to the Democrats, the Republican-controlled Senate has been in staunch opposition to the inclusion of cannabis banking in a coronavirus relief bill. Both Senate Majority Leader Mitch McConnell and Vice President Mike Pence have criticized the marijuana components, arguing that they don’t relate to the matter at hand.
Just a day before Thursday’s vote, McConnell took to the floor of his own chamber to say that the House Bill provides “special treatment to the marijuana industry,” adding that the legislation mentions the word ‘cannabis’ more times than the words ‘job’ or ‘jobs.’ And unlike the House, the Republican-held senate did not include cannabis banking language in its own version of the coronavirus relief bill filed back in July.
However, Democratic leaders, as well as cannabis reform advocates, argue that granting cannabis businesses access to banking institutions could reduce the spread of the coronavirus by reducing the industry’s reliance on cash-only transactions. On top of that, allowing small cannabis businesses to bank with financial institutions gives them access to much-needed capital.
“The continued inclusion of my SAFE Banking Act in this package is important for the cannabis industry and its workers,” says Rep. Ed Perlmutter, the lead sponsor of the cannabis banking legislation. “The industry faces an increased public safety risk and public health risk by being forced to make transactions in all cash. The SAFE Banking Act, which already passed the House with a broad bipartisan vote, will take cash off the streets, enable better social distancing in transactions, and support good-paying jobs in communities across the country when we need them most.”
It remains to be seen whether the hopes of cannabis companies like The Alkaline Water Company Inc. (NASDAQ: WTER) (CSE: WTER) will be fulfilled or put on ice yet again.
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