Canadian Banks Wary Of Pot Businesses, Too

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In the U.S., legal marijuana businesses are struggling to access banking services as banks, though not breaking state-level rules where such businesses are legal, are wary of breaking federal-level law, in which these businesses are illegal.

Canada is similarly grappling with marijuana business banking, according to local reports published Sunday (Nov. 29).

The Globe And Mail highlighted the rising challenge for legal marijuana business owners to find a bank willing to provide them financial services.

“For those seeking lawful ways to profit from marijuana, it only takes one uncomfortable bank employee to quash access to the financial tools essential to running a successful business,” reports said, citing remarks by the chief operating officer of Agrima Botanicals, James Poelzer, who is currently seeking a license to grow medical marijuana.

[bctt tweet=”‘It only takes 1 uncomfortable bank employee to quash access to financial tools'”]

According to Poelzer, giving these companies access to banking services is crucial to Canada’s efforts in legalizing marijuana and eliminating the black market.

Reports noted that last month’s victory of Liberal Justin Trudeau was a boost for marijuana business supporters, with liberals vowing to legalize the drug. But that does not mean major financial institutions will readily and willingly bank these businesses, reports said.

The publication said that no bank would confirm whether or not it provided banking services to any of the 24 small marijuana businesses currently in operation in Canada, or whether they plan to serve the hundreds of individuals seeking a license to operate in the industry.

However, the publication did speak with several of these marijuana businesses, which confirmed that at least three of Canada’s five largest banks are providing financial services to some of the businesses.

And while reports note that Canadian small marijuana businesses are not facing the same challenges as their U.S.-based counterparts, some Canadian companies have been hit with cease-and-desist letters from U.S.-based PayPal because those businesses are subject to the same U.S. laws PayPal is.

Canadian marijuana businesses are allowed to process payments with the local joint venture of BMO and RBC, using Moneris, reports noted.