The Vermont State Employees Credit Union (VSECU) this week announced it has stopped taking on new cannabis business accounts due to a “sudden spike in cannabis accounts,” WCAX reports. The move comes as the state gears up to open retail cannabis sales on October 1.
James Pepper, chair of the state’s Cannabis Control Board (CCB), told WCAX that the credit union’s decision is not surprising as the firm said in July that 50 to 75 cannabis accounts would be “doable” but 200 to 300 would be a “risk.”
Pepper said there are other options, both in-state and out-of-state, for the industry to access financial services.
“The New England Federal Credit Union (NEFCU) has capacity. There are also out-of-state options, and frankly, we are working with our partners over at (the Vermont Department of) Financial Regulation and with the financial institutions themselves to get them more comfortable with the idea of banking cannabis money.” — Pepper via WCAX
VSECU has worked with medical cannabis companies in the state for years and state officials are trying to determine how many cannabis companies already have accounts with the credit union and how many other would be turned down under the new policy. Currently, Vermont has issued about 160 cannabis cultivation licenses.
On its website, the CCB lists just four financial institutions that allow cannabusiness accounts, including VSECU and NEFCU, along with Vermont Federal Credit Union and Dama Financial.
The agency notes that if applicants “can document their unsuccessful good faith efforts to open a bank account, they may still apply for licensure by submitting a cash management plan along with their application.”
Applicants are required under the state’s legalization law to make a “good faith effort” to open a bank account as part of the application process.
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