Cannabis companies finally eligible for pre-approved credit cards
Big banks still treat cannabis-sector entrepreneurs differently than counterparts in other sectors.
Big banks still treat cannabis-sector entrepreneurs differently than counterparts in other sectors, but the ability to conduct banking is slowly getting better.
Community Savings Credit Union today said that it is launching pre-approved business credit cards for its members who operate cannabis-related businesses.
"This industry-first offer finally gives cannabis businesses in B.C. guaranteed access to credit cards, a long overdue change in the financial services available for the industry," the credit union said in a news release.
Many business people involved with legal cannabis-related businesses are rejected by credit-card providers because they are active in the industry.
Community Savings Credit Union CEO Mike Schilling told BIV last fall that he sees advocating for changes to cannabis legislation as his duty, which is why he went to Ottawa to speak at an industry summit, and meet with political staff in the prime ministers’ office and the office of the minister of finance.
His Surrey-based, seven-branch credit union, which has about $900 million in assets under management, has more than 17,000 members, including 150 that are cannabis-sector companies, he said at the time.
"Cannabis businesses have been forced to operate without a fully functioning banking system for too long," he said today. "The industry was legalized five years ago, but big banks have ignored this sector’s needs and credit unions like Community Savings have stepped in."
Community Savings offers three business credit cards. One is its No Fee Cash Back Visa, which allows customers to earn cash back when purchases are made. Another is its Visa Low Rate Business Card, which charges an annual fee and has a comparatively low interest rate, when monthly balances are not paid in full. It also has the Visa Infinite Business Card, which offers rewards and privileges and comes with an annual fee.
Cannabis sector companies continue to think that big banks are discriminating against them, which is why they launched a potential class-action lawsuit against Desjardins Federation, National Bank, Royal Bank, Bank of Montreal, TD Bank, and CIBC earlier this year.
The choice for many in the early years of cannabis legalization was to go to a small credit union on Commercial Drive known as CCEC Credit Union, which in 2022 merged with Community Savings Credit Union.
Business owners in the cannabis sector have long been exasperated with how they are treated by the big banks.
“It’s very frustrating,” aspiring cannabis-sector entrepreneur and Phytron Technologies Inc. CEO Bob Potter told BIV in 2019. “How can companies attract outside money if they can’t deposit it in a secure financial institution? Do they keep the cash in a shoebox under the bed?”
