Banking With Cannabis: Year-End Updates



The cannabis industry continues to soar, as the market for Michigan marijuana, both medicinal and recreational, reached $3.2 billion over the summer, according to the Detroit Free Press1. Even so, many of the functions necessary for running a business have remained somewhat elusive for cannabis retailers. Due to the risk associated with the retail of a federally controlled substance, retailers face challenges from finding basic professional services such as legal representation and accounting to opening a bank account for their business.

The legal marijuana industry’s cash problem has long been an area of concern for several financial reasons, auditing and bookkeeping being chief among them. Not to mention how impractical it is to walk around with a backpack loaded with anywhere from $50,000 - $70,000 just to pay bills, as a recent report from Crain’s Business Detroit reveals has been the situation for numerous retailers since the market’s inception2. However, it would appear that the state’s financial institutions are slowly working toward solutions for clients working within the legal cannabis industry.

According to Crain’s Detroit Business, multiple financial institutions within the state are beginning to open their doors, and more significantly, their business account options to marijuana retailers. Since 2020, institutions such as Lake Trust Credit Union, Citizens State Bank and Frankenmuth Credit Union, have moved forward with legal weed banking programs. "It was important for Frankenmuth Credit Union to provide banking services to cannabis-related businesses, but it was also important that we did so in the right way," CEO Vickie Schmitzer stated in the bank’s official press release. "This meant conducting extensive research into what the industry needed and developing a compliant program around those needs2."

Exercising an abundance of caution is the trending approach, as executive vice president of government relations for the Michigan Bankers Association Patricia Herndon says the total number of banks in Michigan with open doors to the marijuana retail market is still just somewhere around 10, a number corroborated by the Michigan Credit Union League2.

While it was the hope of many to continue this progression with the Secure and Fair Enforcement (SAFE) Banking Act, originally introduced to Congress in 2019 with the intent to prevent financial institutions from being penalized for doing business with the legal marijuana industry, would gain new ground this year, passage of the act remains elusive. Though it was added to the House version of the National Defense Authorization Act (NDAA) in 2021, a Senate conference committee recently struck it from the bill, JDSupra reports. Even so, there are a number of other acts currently under consideration, including the recently introduced State Reform Act, which would federally decriminalize marijuana thereby eliminating several of the risks associated with banking for the cannabis industry altogether3.

As it sits, progress is slow, but it is being made. "The availability of financial services and banks that are engaging in primary, secondary, [and] tertiary levels of cannabis banking continues to grow," Herndon says. In fact, the Michigan Bankers Association is now working to connect marijuana retail businesses with financial institutions that have options for cannabis2.

For CPAs and other accounting professionals working closely with financial institutions on cannabis banking or thinking of adding cannabis services to their current service offerings, the MICPA will continue providing updates on recent developments as they occur. In the meantime, a replay of the 2021 MICPA Cannabis Summit is now available for replay in the MICPA CPE Store, covering a range of topics related to accounting in the cannabis industry, including impacts of the Michigan Regulation and Taxation of Marihuana Act (MRTMA), real property considerations, peer review and more.   


  1. Fogel, Sam “Michigan Weed Market Reaches $3.2 Billion…Detroit Free Press. 28 Jun 2021. Accessed o 16 Dec. 2021.
  2. Frank, Annalise. “Lake Trust Credit Union, Other Financial Institutions Wade…Crain’s Detroit Business. 9 Nov. 2021. Accessed on 16 Dec. 2021.
  3. Gallo, Jonathan. “SAFE Banking Act Removed From Defense Spending Bill.JDSupra. 10 Dec. 2021. Accessed on 16 Dec. 2021.

Source: MICPA

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