Recreational marijuana use in Michigan was legal in 2018, and the cannabis market promptly opened for business. However, not everyone agreed, and the federal government’s continued classification of marijuana as a Schedule I drug posed significant challenges for the cannabis industry.
Banks still don’t want to work with the cannabis industry. Legislators realized the problem and, in April of 2021, passed the Secure and Fair Enforcement (SAFE) Banking Act to remedy the situation. In a nutshell, the United States government still places marijuana in the same category as other addictive narcotic agents. But it has decided to stop prosecuting banks that do business with the cannabis industry for trafficking or money laundering.
Even though this amendment makes it simpler for marijuana businesses in Michigan to open bank accounts, they may still encounter resistance from some banks that are slow to recognise their legitimacy. Is this the situation you find your cannabis company to be in? You can learn your best-case scenario by consulting professional Detroit business consulting in Troy, MI. To locate a financial institution familiar with the challenges of this expanding sector, consider the following advice.
Engage the services of a professional accountant as a first step.
Initiate all other actions only after consulting with an accountant well-versed in cannabis law. Without a professional looking out for your best interests, you could run into more than financial difficulties. A certified public accountant (CPA) with experience in the cannabis industry will know how to handle bookkeeping, audits, and payroll issues until you can establish a relationship with a bank.
Don’t forget that cannabis laws on all levels (local, state, and federal) are subject to change. How much time do you have to keep up with all the legislation and rules pertaining to your industry while running a new or expanding business? If you don’t have an accountant who follows these developments, you could set yourself up for trouble come tax time.
Look Around for the Best Bank or Credit Union
You are aware that the SAFE Act is brand new legislation. It could take some time for financial institutions to stop investigating banks that work with cannabis businesses, even if federal agencies decide to stop investigating them. Banks, after all, have a well-deserved reputation for being overly cautious.
If large banks are hesitant to open an account for you, stick with a smaller, community-based institution. For financial services, a marijuana dispensary may find more favor with credit unions and smaller regional banking chains.