{"id":286772,"date":"2019-10-17T08:14:05","date_gmt":"2019-10-17T13:14:05","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/cannabis-law\/starting-a-cannabis-business\/can-marijuana-dispensaries-use-traditional-banks.html"},"modified":"2025-05-07T15:31:20","modified_gmt":"2025-05-07T20:31:20","slug":"can-marijuana-dispensaries-use-traditional-banks","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/cannabis-law\/starting-a-cannabis-business\/can-marijuana-dispensaries-use-traditional-banks.html","title":{"rendered":"Can Marijuana Dispensaries Use Traditional Banks?"},"content":{"rendered":"\n
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Can Marijuana Dispensaries Use Traditional Banks?<\/h1>\n
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\n By Balrina Ahluwalia, Esq.<\/a> | Legally reviewed by Laura Temme, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

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Key Takeaways<\/h2>\n

Most marijuana dispensaries and related businesses can\u2019t use traditional banks because marijuana is still illegal at the federal level. This forces many dispensaries to operate primarily in cash, creating challenges in managing finances securely and efficiently. While some progress has been made with legislative efforts such as the SAFE Banking Act and SAFER Banking Act, comprehensive solutions are still pending. <\/p>\n\n <\/div>\n <\/div>\n<\/div>\n

Cannabis-related businesses<\/a> (CRBs) in the U.S. face many obstacles accessing traditional banking services. Marijuana dispensaries are no different. Even with the legalization of recreational and medical marijuana in many states like Colorado<\/a>, it’s still illegal at the federal level. This often makes traditional banks hesitant to offer services to cannabis companies.<\/p>\r\n

For growers and retailers, this creates massive challenges. However, lawmakers are actively trying to address the problem.<\/p>\r\n

If you\u2019re a small business owner trying to navigate a legal issue in the marijuana industry, this dynamic landscape can be complex and confusing. Consider speaking with a cannabis law attorney<\/a> for advice. They can help you understand the current state of laws that apply to your specific situation so you can determine the best way to proceed.<\/p>\r\n

In this article, we\u2019ll review some information you\u2019ll want to keep in mind. Let\u2019s start with the federal laws that make banks nervous to work with dispensaries.<\/p>\r\n

Federal Laws That Limit Banking Services for Cannabis Businesses<\/h2>\r\n

Dispensaries generally don\u2019t have access to traditional banking services at larger banks and financial institutions. Some might be able to find a smaller bank or credit union<\/a> to provide them with business banking services. But this is usually at a high cost.<\/p>\r\n

Larger banks and financial institutions generally stay away. This is largely due to concerns about potential violations of federal law and the higher burden of compliance. We explore some of these laws and compliance obligations below:<\/p>\r\n

The Controlled Substances Act<\/h3>\r\n

The Controlled Substances Act<\/a> (CSA) classifies marijuana as an illegal Schedule I drug. This discourages banks from providing services to marijuana businesses because they’re worried about facilitating illegal activities.<\/p>\r\n

Anti-Money Laundering Laws<\/h3>\r\n

Banks must follow strict Anti-Money Laundering (AML) laws <\/a>and regulations to prevent financial crimes. For example, the Bank Secrecy Act (BSA) mandates that banks report suspicious activity and detect\/prevent money laundering.<\/p>\r\n

Because the CSA illegalizes marijuana, banks fear potential money laundering charges for handling proceeds from marijuana sales. Also, compliance with AML laws for banks servicing dispensaries has been notoriously tricky.<\/p>\r\n

Federal banking regulators oversee and enforce AML laws. The U.S. Treasury\u2019s Financial Crimes Enforcement Network <\/a>(FinCEN) is one such regulator.<\/p>\r\n

FinCEN has issued guidance <\/a>to clarify due diligence obligations for banks servicing cannabis businesses. This guidance places a significant compliance burden on service providers, which contributes to their reluctance to work with cannabis dispensaries.<\/p>\r\n

For example, FinCEN’s guidance requires banks to file Suspicious Activity Reports (SARs). These include:<\/p>\r\n