A new state law allowing Nevada to test out a limited marijuana banking system is expected to bring some relief to the state's booming cannabis industry where dispensaries and other businesses are forced to deal in cash.
The measure, signed into law last week by Democratic Governor Steve Sisolak, would let the state treasurer’s office set up a three-year pilot program for cannabis businesses.
State Treasurer Zach Conine, who pushed for the program, said the system would try to remove the large amounts of cash that Nevada's pot industry must deal with and instead set up an online system where digital currency could be sent and received.
Conine likened the system to gift cards or digital wallet apps such as Venmo and said the program would not include broader banking services like loans.
"We think it's an innovative solution to a real problem," Conine said.
It's the latest example of states with some form of legal marijuana trying to address the industry's challenges with banking.
Most banks won't do business with the industry because the U.S. government still considers marijuana illegal. Last month, attorneys general from 33 states urged Congress to approve a proposal to open the U.S. banking system to the legal marijuana industry.
But until the federal government steps in, states are coming up with their own plans.
Hawaii set up a similar cashless, debit payment app for medical marijuana sales, a system that's available in several other states.
In California, the nation's largest legal marijuana market, lawmakers are considering legislation that would create a special class of banks for the industry.
Nevada's system will be voluntary, but the state will try to recruit businesses within the marijuana industry to participate, as well as other businesses that deal with the industry, such as landlords, payroll firms and garden supply companies.
Conine said he hopes to have the system up and running by July 1, 2020, to ease some of the burden for businesses who have to pay employees with envelopes of cash and drive to government buildings with duffel bags of cash to pay state taxes.
"It's hard to pay vendors. It's hard to pay employees. It's hard to pay taxes," said David Goldwater, a Las Vegas dispensary owner.
Goldwater, who is a former state lawmaker and serves as secretary of the Nevada Dispensary Association, said his business is planning to participate because the program sounds like it could be useful but Nevada's limited system won't solve the industry's banking problems.
“I think anybody that’s been working in the industry understands that the banking solution isn’t going to come from the state,” he said. “It’s going to come from federal action.”
- Associated Press