Washington, D.C. (March 18, 2021) — The Independent Community Bankers of America (ICBA) today expressed support for bipartisan legislation that would establish a safe harbor from federal sanctions for financial institutions that serve cannabis-related businesses in states where cannabis is legal.
Introduced by House Financial Services Committee Subcommittee on Consumer Protection and Financial Institutions Chairman Ed Perlmutter (D-Colo.), the Secure and Fair Enforcement (SAFE) Banking Act would enhance public safety and address regulatory compliance concerns by opening the traditional banking system to cannabis-related businesses. Similar legislation from Rep. Perlmutter passed the House in 2019 but did not advance in the Senate.
“The conflict between state and federal law has created legal uncertainty for community banks, inhibited access to the banking system for cannabis-related businesses, and created serious public safety concerns,” ICBA President and CEO Rebeca Romero Rainey said. “As the first national banking trade group to support the SAFE Banking Act and to testify before Congress on its behalf, ICBA urges lawmakers to pass this bill to enhance public safety and address regulatory compliance concerns."
Legal uncertainty has forced cannabis-related businesses to operate mostly in cash, which presents a significant public safety risk. The bipartisan SAFE Banking Act would help eliminate this risk in states that have legalized cannabis for medical or recreational use. In these states, federal banking regulators would not be permitted to threaten or limit a bank’s deposit insurance, downgrade a loan, prohibit or discourage the provision of banking services, or take any other prejudicial action on banks solely for serving a cannabis-related business.
“The SAFE Banking Act will allow financial institutions the certainty they need to start banking legitimate cannabis businesses. It is a crucial step forward for the cash-only industry and will help prevent illicit activity, improve transparency and accountability, and reduce the public safety risk in our communities,” said U.S. Rep. Ed Perlmutter (CO-07). “Thank you to ICBA for their longstanding support of the SAFE Banking Act and their partnership through the first-ever congressional hearing on cannabis banking and previous passage in the U.S. House. I look forward to continuing to work with ICBA as we get SAFE Banking passed in the Senate and signed into law.”
The Independent Community Bankers of America creates and promotes an environment where community banks flourish. ICBA is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education, and high-quality products and services.
With nearly 50,000 locations nationwide, community banks constitute 99 percent of all banks, employ more than 700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding more than $5 trillion in assets, over $4.4 trillion in deposits, and more than $3.4 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.