Delaware is celebrating after passing HB 355, which provides financial institution protections for cannabis-related businesses. As the state prepares for the launch of its legal adult-use cannabis industry. State lawmakers have approved legislation proposed by State Treasurer Colleen Davis. This legislation offers protections for banks and other financial institutions serving licensed marijuana businesses.
Although marijuana remains illegal at the federal level. Delaware joins many other states in legalizing it for medical or recreational use. Treasurer Davis believes that this legislation will help bridge the gap between state legalization and federal banking laws. Additionally, this protects banks serving legal marijuana businesses.
House Bill 355, sponsored by Rep. Ed Osienski and Sen. Trey Paradee clarifies that providing financial services to legal cannabis businesses is lawful under Delaware state law. Likewise the bill’s passage removes a significant barrier for the cannabis industry. That has struggled to access traditional banking services due to marijuana’s federal classification as a Schedule I drug.
“This legislation is a critical step forward for Delaware’s cannabis industry,” said State Treasurer Colleen Davis. “By ensuring safe access to banking services, we are empowering legitimate businesses to operate transparently and securely.”
The passage of H.B. 355 marks a pivotal moment for Delaware’s legal marijuana industry and the financial institutions that will support it. As a result this provides clear legal protections and a solid regulatory framework. The new law will protect the safety, security, and long-term viability of this sector of the economy.
“Across the country, we’ve witnessed dispensaries and banks alike struggling with legal uncertainty. All of it surrounding financial and accounting services for cannabis businesses. This uncertainty not only undermines the operations of state-compliant dispensaries. Hindering their access to basic business functions such as banking, acquiring loans, or paying taxes,” said Rep. Ed Osienski. “We want Delaware’s safe and regulated industry to out-compete the illegal market. By providing dispensaries with a secure avenue to banking and compliance services. We empower them to contribute positively to our economy. Keeping costs down for the industry and customers, employ local talent, and fulfill their tax obligations.”
“At the end of the day, cannabis retailers in Delaware are small businesses, built in our communities. Therefore hiring Delawareans. They pay their taxes. They will contribute to the economic development of this state,” said Sen. Trey Paradee. “With an over-reliance on cash transactions, retailers are at a disadvantage in terms of their banking, compliance, and safety needs. With the passage of this legislation. The state can ensure that these businesses have a clear path towards access to those critical services.”
“This legislation creates a safer environment for legally operating businesses within the state’s marijuana industry,” said Rob Coupe, Commissioner of the Delaware Office of the Marijuana Commissioner. “The legislation not only provides legal protections for financial institutions and service providers working with licensed marijuana businesses. It also strengthens regulatory oversight and facilitates compliance with tax regulations.”
The bill aims to increase the willingness of banks and other financial institutions to serve legal cannabis businesses by providing legal clarity and certainty, promoting compliance and transparency in the cannabis industry, and reducing the risk of enforcement against banks involved in the industry. It will also reduce reliance on cash transactions among marijuana businesses, decreasing the risk of robbery and theft. These safeguards will benefit businesses. Providing financial-related services and the retailers, and should incentivize customers to patronize legal, licensed retailers instead of black-market sellers.
HB 355 passed the Senate 16-5 on June 25 and the House on March 28 with 38 votes and three absent. It provides legal protections for financial institutions and other entities offering financial or accounting services to cannabis-related businesses licensed or registered under Delaware law. Specifically, it clarifies that banks, credit unions, armored car services, and providers of accounting services are not subject to prosecution under Delaware law merely for providing lawful services to licensed businesses engaged in the production, distribution, and sale of cannabis in Delaware. This act aims to facilitate the operation of cannabis-related businesses by ensuring they have access to necessary financial and accounting services.
