Credit Union 1 rolling out banking services for Alaska cannabis businesses

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Credit Union 1 in Alaska announced in a press conference earlier this week that they will launch a pilot program that will offer banking services to cannabis related businesses.

“The credit union has always had out best success when we make our own magic and go our own way to serve our members, and especially to serve those who are in need of service or who are under served, and we see the MRB industry as being in that bucket, having had no access to financial service here in the state,” Credit Union 1 President and CEO James Wileman explained during the conference.

“Credit Union 1 is Alaska’s only state chartered credit union, so there is guidance that exists on a federal level, from a reporting standpoint, cash in and cash out, things of that nature that we will be compliant with and have a program to track to ensure that the cash going through the credit union is from a legally recognized business in the state,” said Wileman.

Marijuana businesses in Alaska are currently forced to work with primarily cash and are very limited in available banking services because of cannabis still being illegal federally. Wileman has referred to the issue as a “cash crisis” in Anchorage, but has assured that the motives behind the project are not backed by political opinion.

“Credit Union 1 is not taking a political or moral position on the legalization of marijuana by providing these services,” Wileman said. “Imagine for a moment, in your own life, running your household or business without access to the services you have.”

Kelly Marrzei of the Alaska Department of Revenue, the cannabis industry in the state is expected to reach more than $200 million in sales this year. This results in $1.5 million in cash that must be counted each month. The Credit Union 1 project will likely alleviate a lot of the issues and risks associated with an all-cash business.

“A lot of our vendors and cultivators have the same problems,” said Cecilia Jefferson, the manager of Dankorage, a retailer in Spenard. “It would be safer for us and our customers to carry around credit or debit cards, but everything is cash, cash, cash.”

There are currently no specific details about the businesses that will participate in the program but it’s expected to rollout within the next year. The credit union has said that it will start making decisions about offering the services to all cannabis related businesses following around six months of trials.

“There is so much more safety that is going to come from this, where now I will be able to pay my taxes with a check,” said Dan Peters, owner of GoodSinse, a retailer in Fairbanks, Alaska. “Past the safety checkpoint is just us being able to accept credit cards potentially and do other regular business moves that a lot of business enjoy.”

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