SAFE Banking Act hits snag in Senate

(Nov. 19, 2021) A new hurdle emerged in the Senate this week to legislation that would provide clarity to financial institutions seeking to serve legitimate cannabis businesses: disagreement about whether to include the provisions in pending legislation, or advance it as part of a larger package largely changing federal marijuana laws.

The disagreement, at least for now, imperils the future of the bill for financial institutions serving legitimate cannabis businesses.

The Secure and Fair Enforcement (SAFE) Banking Act would provide a safe harbor for credit unions and banks serving cannabis businesses in states where it is legal. More than 35 states have legalized cannabis for medical or adult use. However, federal law prohibits credit unions and banks from safely banking cannabis businesses, including those that provide them with goods and services.

The legislation has passed the House with bipartisan support and was added to the House version of the National Defense Authorization Act (NDAA), must-pass legislation by year’s end to essentially keep the military funded.

But some in the Senate want to add more provisions related to marijuana legalization to the Senate NDAA version. On Thursday, Senate Democratic leaders indicated the SAFE Banking Act would not be considered in the Senate as part of the NDAA without the broader marijuana decriminalization provisions – essentially removing the SAFE bill from the NDAA, at least for now.