“Your money is no good here” – Imagine if you were unable to bank your takings.

The cannabis industry in the US has grown from $1.3 billion dollars in 2013, to an estimated $5.4 billion dollars in 2015. Due to federal law it is not legal to bank profits from selling cannabis, even if compliant with state law. Furthermore, it is not permitted to pay in anything other than cash for these products.

Whilst it is possible to get bank accounts, banks will often close them once they realise the accounts are being filled with ‘pot money’. Some credit unions are offering bank accounts to cannabis business owners, but there is a high cost associated due to the risk being taken on the by credit union.

“By compelling Oregon business owners to operate on a cash-only basis, current federal laws are making marijuana businesses sitting ducks for violent crimes and perpetuating negative stereotypes. It is ridiculous to make any business owner carry duffel bags of cash just to pay their taxes,” Sen. Ron Wyden said in July after he, Sen. Jeff Merkley and two senators from Colorado introduced reform legislation to Congress.

Business owners say cash would be best kept in a bank vault. They’re also facing other stumbling blocks: Cannabis businesses aren’t eligible for tax deductions and often have trouble renting space because landlords fear banks could pull their mortgage for paying loans with money connected to pot. Add to that the headache of doing business accounting and paying taxes in cash. (Statesman Journal)

This stumbling block now mean that cash in transit companies are increasing their costs as they take on ever increasing collection values. From a few thousand dollars per collection, it is not unusual to see collection values in the hundreds of thousands.

Published in the Statesman Journal and Reason TV.