The Senate’s Crucial Push for Cannabis Banking Reform with the SAFE Act
A cross-party group of U.S. senators is rallying support for the Secure and Fair Enforcement (SAFE) Banking Act, aiming for committee approval in the near future. Senate Banking Committee Chairman Sherrod Brown (D-Ohio) hinted that an announcement could be imminent.
The legislation aims to provide a legal safety net for banks and credit unions to offer their services to cannabis businesses, an industry currently hindered by federal laws despite state-level legalization. A shift in federal classification of cannabis from Schedule I to Schedule III has fueled optimism among Democrats. Senator Ron Wyden (D-Ore.) sees it as another step toward eradicating the antiquated ‘Reefer Madness’ mindset.
However, Sherrod Brown states there are still a few minor issues to resolve before they secure sufficient bipartisan support. While cannabis is legalized for medical or recreational use in 38 states and the District of Columbia, it remains illegal federally. This complicates banking access for legal cannabis businesses.
The SAFE Banking Act, proponents say, will alleviate the risks of cash-only transactions for these businesses without changing its legal status where it’s already legal. But the bill has had a tumultuous journey in the Senate, hampered by both sides of the aisle for different reasons.
While some Democrats are pushing to add broader drug law reforms like the Harnessing Opportunities by Pursuing Expungement (HOPE) Act, such add-ons could risk losing Republican backing. Anti-cannabis GOP members and other groups argue that the focus should remain on banking solutions for cannabis businesses.
Despite some Republican resistance and divided opinions among Democrats, Sen. Jack Reed (D-R.I.) believes both sides are making progress in the discussions. Timing for the markup remains uncertain, but key Republican Sen. Steve Daines (Mont.) is optimistic it will happen “sometime in September.”
Various non-cannabis stakeholders like the American Bankers Association (ABA) are also pushing for the legislation, emphasizing that it’s more a financial bill than a cannabis bill, making it more digestible for some lawmakers.
So, as the debate heats up, all eyes will be on the Senate to see if the SAFE Banking Act can finally clear its numerous hurdles and mark a new era for the cannabis industry’s banking options.
