Published on December 13th, 2014 | by News Feed
Colorado Welcomes the Country’s First Credit Union for Marijuana Retailers
Legalization has brought rapid change to Colorado, but it has also delivered several challenges. One of the biggest issues has been financial. There is so much money coming in that dispensaries and retailers have no safe way to store their profits. Most Colorado banks refuse to do business with marijuana retailers so the owners are stuck stockpiling cash in their homes and storage lockers. This is obviously not an ideal scenario, but a solution is on the horizon. This week, Colorado announced that it has officially approved the new Fourth Corner Credit Union to work with marijuana distributors.
Now that state approval is complete, the final step is to gain a Federal Reserve master account number to give the credit union access to the national electronic banking system. “We are on the one-yard line,” Attorney Mark Mason explained. Some have speculated that gaining the federal reserve account number could be problematic, but Colorado’s commissioner of financial services, Chris Myklebust, doesn’t foresee any real problems. He said that once that account number is received, the bank will only need to get an insurance policy and sign a lease to begin operations.
This credit union cannot open soon enough for Colorado’s busy retailers. “If you can’t get your cash into the Federal Reserve system, you end up stockpiling it in your home, in caves, in your business. At some point, the risk becomes worth it for organized crime,” Myklebust explained. “I’ve never even held a joint but I really want to see them banked.”
Kristi Kelly, owner of GoodMeds Marijuana Dispensary, is one of the founding members of the new credit union and she is excited to finally have access to legitimate banking options. “We consider ourselves regulated, legitimate businesses. We just want to have the same access to banking that other legitimate businesses have,” she explained. “I don’t want to pay people in cash.”
Dan Sullivan, vice-president at Blue Line Protection Group, said the credit union will be a much-needed answer for many Colorado businesses. Blue Line is one of America’s largest marijuana security firms. They offer armored cars and security officers to oversee and transport money that marijuana retailers need to store or move. “What a lot of people don’t understand is that electronic money is easy to move around,” Sullivan said. “Cash is an enormous amount of work.”
There is no lack of cash flow for Colorado’s pot industry these days. In fact, some businesses have been forced to pay their state taxes by hauling buckets and boxes of cash to the state revenue department. Sullivan said some businesses are taking in tens of thousands of dollars each week and storing that money safely has been nearly impossible.
The new Fourth Corner Credit Union will offer accounts to anyone with an interest in the marijuana industry, but it will be mostly limited to Colorado customers in the beginning. It will take some time to figure out the logistics, but business owners are hopeful for a future where they can write checks rather than dealing in cash for everything.