With banking one of the main problems plaguing the US cannabis industry, West Town Bank & Trust has launched a dedicated cannabis banking programme.
Access to financial services is a major problem in the US for the cannabis industry. Federal regulations mean that cannabis businesses have to operate without bank accounts or electronic payments, with some businesses currently using third-party intermediaries who partner with FDIC-insured banks behind closed doors.
In a recent survey of 396 licensed cannabis companies, over 70 per cent of those surveyed said that the lack of access to banking or investment capital was the most challenging aspect of business.
Forced to work with cash, many dispensaries experience related problems, including robberies of stores – some of which have led to deaths. The Secure and Fair Enforcement (SAFE) Banking Act, which was included in the must-pass National Defense Authorization Act (NDAA) in September 2021, aimed to amend federal banking laws. However, the Act has yet to be debated.
The new West Town Bank & Trust programme is aiming to improve access to financial services for cannabis businesses nationwide, including banking and electronic payments.
West Town Bank & Trust senior VP of hemp and cannabis banking, Ross Sloan, commented: ”As one of the first banks to roll out a hemp banking programme after the 2018 Farm Bill, we witnessed first-hand the role dedicated banking programmes played in advancing the entire industry.
“We’re excited to do the same for cannabis businesses, offering them the banking services they need to fuel not only their growth, but the growth of the entire cannabis industry.”
The new programme offers a full suite of financial service products to cannabis businesses and ancillary partners, allowing access to business checking accounts, electronic payment options, and more.
West Town Bank & Trust has an in-house team comprised of certified cannabis bankers, and focuses on regulatory compliance.
Hemp and cannabis programme director at West Town Bank & Trust, Mel Barnes, believes the Bank’s existing framework and successful track record in the hemp space will raise the standard for cannabis financial services.
Barnes commented: “Legal cannabis businesses should be able to access the same financial services as other industries. Using our in-house industry expertise, along with leveraging technology partners such as RiskScout, we’ve built a robust online onboarding and due diligence infrastructure that allows customers to access the services they need while feeling secure in their financial partner.
“This same infrastructure provided the opportunity to effectively scale our hemp program and we are excited to have the support from our board of directors and executive management team to make a full commitment to serve the cannabis market.”