As a young industry, the cannabis market is sure to experience some growing pains. But perhaps the biggest hurdle that legal marijuana entrepreneurs have to overcome is the non-support of the federal government, which leads to a complicated slew of problems, including financial woes.
Take businessman Shaun Gindi for example. As the owner of two medical marijuana shops and a cannabis warehouse in Colorado, Gindi faces problems when it comes to storing the cash meant for his businesses. “I’ve gone through at least eight banks,” he said. The latest bank where he tried opening an account was in his local Chase branch. His account was closed just after a week.
According to the Department of Treasury, only 220 of America’s 7,600 banks and credit unions are willing to accept cannabis cash, all because weed businesses are still essentially violating federal law. The solutions are few and far between, but Harvard Business School graduate Anthony Rivera, Jr. has an idea made especially for Native Americans: the creation of an American Indian banking system. After all, the 566 sovereign Indian nations all over the United States are not subject to the country’s banking laws.
Known as CannaNative, Rivera’s organization aims to use their expertise in managing casinos to create banks or credit unions that can be used by the legal pot industry, which promises an estimate $3 billion in annual revenue.
“The Indian casinos are basically small little banks,” said Rivera. “They receive deposits in the form of gaming, and they manage that cash in a way which is highly regulated.”
The company wants to link tribal leaders with finance professionals and legal marijuana businesses. It may not be as easy as it sounds, but CannaNative is planning to emulate the casino model of the 1980s by hiring managers from various marijuana companies to teach tribes how to set up financial institutions for the cannabis industry.
“When Indian gaming became legalized, tribes didn’t know how to run casinos,” Rivera said. “So many companies that knew how to run gaming operations became managers of the tribal enterprise until the tribe figured it out. Then the tribe took it over.”
This will surely help Native Americans get a head start on the marijuana industry. Larry Banegas, member of Southern California’s Barona Band of the Kumeyaay Nation, said, “Having CannaNative to be the voice, I think the native people will listen to them.”
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