Cash intensive business are a major high risk for banks, because of the security it takes to handle the cash and the oversight it needs to make sure the cash is not being laundered. There are several businesses that meet this criteria, but we are focused on finding banking for a new and explosive growing market…the cannabis market. With the rise of legalization across multiple states in the U.S. and more planning to legalize, the need to bank these businesses has become crucial. While some banks have welcomed some cannabis dispensaries, grow, and marijuana related businesses, it has not been a stable environment. In order to stay in line with compliance and regulations many banks have closed accounts or decided to back out all together. With the market expected to grow from $9 billion to over $25 billion in the next few years this is a task worth tackling.
The federal government’s views on what to do about this is still up in the air. Which means there’s no guarantee that any monies within the banking system is 100% safe. But many banking veterans have started taking the steps to meet the regulatory and compliance challenges to find a solution. The key is proper due diligence, complete oversight of transactions, and full transparency of all business practices. This is a labor intensive process including the vetting and maintenance of accounts.
However, we are working with several banking groups willing to take the chance to make it more secure for these businesses. Most cannabis related businesses are risking their lives having to run around with satchels and duffle bags of cash. PayHouse is working directly with banking executives, groups, liaisons and banks to provide that safest solution possible. Although these banking solutions are safe they can also be costly…but not more costly than your safety.
PayHouse has been working profusely to put together protocols that meet rigorous compliance standards with our banking partners. We believe that the guidelines put in place present the most secure banking solution for cannabis related business. Although any business wanting to apply for our program should be aware that the process will be very in-depth and somewhat intrusive. This is to ensure to bank regulators that the business is ran cleanly and everyone involved is on the up-and-up. This process involves, but not limited to very thorough vetting of all principals, detailed onsite location surveys, review of all financials, and extensive background checks. If you are not prepared to go through this rigorous process then please do not apply.
We work with several options including tier 1, tier 2, and international banks. Our domestic solution is our focal point. This solution offers a way for you to solve the headache of cash handling and banking safely. You’ll have the opportunity to setup up 2 accounts for Operational Cash and Legacy Cash, both will require thorough tracking of how the cash was received and claimed for. If you should be accepted for the program, all cash will be handle by the coordination of the bank and armored cash vault company contracted with the bank. This protects the business and makes a record of the cash collected. POS software will also be crucial to account for all daily transactions and record keeping to establish legal sale of any goods or products. Tracking of revenue is key.
For those looking to move their revenue into a safe banking system, you must be aware that this is not a fast process. The time frame can take anywhere from 4-8 weeks depending on the scope of your operation. If you are interested in talking with one of our PayHouse Advisors, please contact us here to get a prequalification started.