Banking for marijuana businesses is accessible but challenging

Banking for marijuana businesses is accessible but challenging

Since Missouri legalized medical marijuana in 2018, banking for marijuana-related businesses has become more accessible. But the marijuana industry continues to face hurdles that other commercial establishments don’t have to consider.

Marijuana remains illegal at the federal level, which means marijuana-related businesses have restricted access to federally-regulated financial services, including loans and 401(k)s. Marijuana-related businesses are also limited as to what payment-processing companies (debit/credit cards) they can work with and must pay a steep tax rate.

Since the sale of medical marijuana began in Missouri, the industry has boomed. Sales, which began in October 2020, recently surpassed $600 million, according to Lyndall Fraker, director of public outreach for the Missouri Division of Cannabis Regulation.

Tax rates over 70%

The 280E tax code is one of the biggest challenges the marijuana industry faces nationwide, said David Brodsky, director of retail at The Farmer’s Wife, which operates three dispensaries in southern Missourn.

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