Massachusetts Banks Open to Serving Recreational Cannabis Companies

GFA Federal Credit Union, a Massachusetts credit union with headquarters in Gardner, will become the first financial institution in the Commonwealth to serve the recreational cannabis industry by offering banking services to cannabis companies.  This represents a major step forward for companies in the Commonwealth’s burgeoning recreational cannabis industry, as previously most companies resorted to running cash-only operations without being able to offer customers the benefits of credit or debit purchases.  GFA Federal Credit Union has reportedly conducted extensive research over the course of the past year into the issue of servicing the recreational cannabis industry and has determined that the time is ripe to enter the industry, even as other financial institutions refrain from doing so.  While these other institutions have calculated that the legal and financial risks are too uncertain for them to offer services to cannabis companies at this time, GFA Federal Credit Union has concluded that it could legally and profitably provide banking services to marijuana operators and providers, and that it could help improve public safety in so doing.  GFA’s chief executive, Tina Sbrega, has made this point in interviews when stating: “We’re looking at a cannabis business as a legitimate business that wants to be recognized as such and that, without banking services, presents a tremendous public safety issues in our communities….Otherwise, you’re talking millions and millions of dollars of cash on the street.”  Indeed, Sbrega has indicated that she expects cannabis to be “one of the fastest growing divisions’ of GFA.

The credit union has begun accepting cannabis customers as of October 1, and the development has not gone unnoticed at the Cannabis Control Commission.  Chairman Hoffman has hailed the news as a significant development that should assuage concerns about crime and spur increased investment in the Commonwealth’s cannabis industry, both recreational and medical.  According to Chairman Hoffman: “its a real big deal that GFA decided to enter this industry…I expect that its going to look like other states, where once the first institution dips its toes in the water, there will be others that follow.”  Ultimately, GFA’s decision should come as a welcome development to many stakeholders in the cannabis industry, and may just be a sign of things to come.

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