America’s state legal cannabis industry has been dubbed one of the fastest-growing industries in the country, but its federal classification has been a constant hindrance. While more than 30 states allow either medical or recreational cannabis, the federal government still classifies marijuana as a Schedule I controlled substance. Consequently, banks and financial institutions do not transact with businesses in the cannabis space, and, in many cases, they won’t even work with businesses that are indirectly connected to cannabis.
In the wake of the coronavirus pandemic and the resultant financial crisis, a group of senators has urged the federal government to grant cannabis firms access to financial aid. In a letter sent to the Appropriations Committee leaders, 10 senators have asked that language allowing cannabis firms to access financial aid via the federal Small Business Administration (SBA) be added to a soon-to-be unveiled spending bill document. This would see businesses in the cannabis space finally access SBA loans as well as disaster assistance as the country and world at large recovers from the worst financial downturn in a century.
Federal relief would help alleviate the impacts of the coronavirus pandemic, the senators wrote. Led by Sen. Jacky Rosen, the group was comprised of Senators Bernie Sanders, Cory Booker, Jeff Merkley, Maria Cantwell, Ed Markey, Ron Wyden, Bob Menendez, Alex Padilla and Raphael Warnock. The group sent the letter to the heads of the Appropriations Financial Services and General Government (“FSGG”) and the Senate Appropriations Committee asking that the federal aid language to be appended within the FSGG spending bill document for the fiscal year 2022.
The letter also requested that state legal cannabis businesses be allowed access to the Loan Guarantee, Microloan, Disaster Assistance and the 504/Certified Development Company Loan Programs. The SBA currently excludes businesses that are directly or indirectly involved with the cultivation, production and sale of cannabis products, the letter says, and this places undue and unfair pressures on small enterprises operating in states with legal cannabis markets.
Additionally, the letter mentions that banks do not transact with cannabis businesses because they fear repercussions from the federal government. As such, these cannabis operations mostly operate on a cash-only basis, which puts them at a high risk of robberies and burglaries. Additionally, the coronavirus can survive for quite a while on paper money, putting workers in the cannabis space as well as their clientele at risk of infection.
It would be good for the entire marijuana industry, including sector players such as Chalice Brands Inc. (CSE: CHAL) (OTCQB: CHALF), if companies in the industry were given the same access to federal business loans as do companies in other industries. Such a gesture would mean that the state-legal marijuana industry was being accorded equal treatment with other industries.
NOTE TO INVESTORS: The latest news and updates relating to Chalice Brands Ltd. (CSE: CHAL) (OTCQB: CHALF) are available in the company’s newsroom at https://cnw.fm/CHALF
About CNW420
CNW420 spotlights the latest developments in the rapidly evolving cannabis industry through the release of two informative articles each business day. Our concise, informative content serves as a gateway for investors interested in the legalized cannabis sector and provides updates on how regulatory developments may impact financial markets. Articles are released each business day at 4:20 a.m. and 4:20 p.m. Eastern – our tribute to the time synonymous with cannabis culture. If marijuana and the burgeoning industry surrounding it are on your radar, CNW420 is for you! Check back daily to stay up-to-date on the latest milestones in the fast -changing world of cannabis.
To receive instant SMS alerts, text CANNABIS to 21000 (U.S. Mobile Phones Only)
For more information please visit https://www.CNW420.com
Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW420, wherever published or re-published: http://CNW.fm/Disclaimer
Do you have questions or are you interested in working with CNW420? Ask our Editor
CannabisNewsWire420
Denver, Colorado
http://www.CNW420.com
303.498.7722 Office
Editor@CannabisNewsWire.com
CNW420 is part of the InvestorBrandNetwork.