Many financial institutions across the country continue to resist providing traditional banking services to marijuana-related businesses (MRBs) due to the legislative gray area facing the industry. Marijuana is currently federally illegal under the Controlled Substances Act (CSA), regardless of any state legislation that has passed. This makes the financial industry, particularly federally insured and regulated financial institutions, cautious when opening their doors to MRB clients, either direct or indirect.
With the passing of the 2018 Farm Bill, hemp and hemp-derived CBD have been removed from the CSA, and the cultivation and distribution of hemp will be federally legal once the United States Department of Agriculture (USDA) finalizes their interim rule, planned by the end of 2019 in time for the 2020 growing season. However, marijuana legislative reform, for which many bills have been drafted, has not moved far in the legislative process until recently. Marijuana and hemp are both subspecies of the cannabis plant. Marijuana contains the psychoactive chemical tetrahydrocannabinol (THC), generally 10% or greater, and hemp by law contains 0.3% THC or less and does not get the user high.