The US cannabis industry’s one big problem: Too much cash

Most banks refuse to service the industry because of federal rules, leaving marijuana sellers to deal with bags of cash.

The US cannabis business has a very particular cash flow problem – too much of it. Marijuana can be sold legally in 36 US states and the District of Columbia (DC) for medical use and in 15 of them and in DC for recreational purposes. But it is still illegal on a federal level, meaning most banks refuse to service the industry in case they fall afoul of money laundering laws. With the COVID-19 pandemic and increasing legalisation driving a surge in cannabis use, the sector’s producers, manufacturers and retailers are awash in cash, adding risk and costs to the most basic business transactions from paying employees and filing taxes to finding somewhere to store their income.