The California Senate has advanced Senate Bill 930 — a.k.a. the Cannabis Limited Charter Banking and Credit Union Law — which seeks to establish new rules allowing California banks to serve businesses who are denied banking services due to their involvement in the still federally prohibited cannabis industry.
According to an Associated Press report, the bill passed through California’s Senate with a bipartisan, 29-6 majority.
If signed into law, SB 930 would permit banking institutions regulated by California’s Department of Business Oversight — including both charter banks and credit unions — to provide limited banking services to the currently cash-only industry. Cannabis companies could use those services to pay rent, to pay state and local taxes (but not federal taxes), or to pay other California companies for goods and services related to the cannabis space.
The limited banking services would not allow for any out-of-state payments.
“We’re not using the federal system, we’re not using the federal wire. This is a short-term creative approach to deal with this extraordinary problem.” — Democratic Sen. Bob Hertzberg to the AP
Lawmakers reportedly consider this move to be just a temporary strategy under the assumption that cannabis will someday be legalized at the federal level.
The bill now moves to the California state Assembly for consideration.
California’s adult-use cannabis industry kicked off in January and is expected to grow into a $7 billion marketplace — it is the world’s largest legal cannabis market, by far.