Reps. Lee, Blumenauer seek minority cannabis business financial services data

U.S. Reps. Barbara Lee (D-CA) and Earl Blumenauer (D-OR) recently forwarded correspondence to the Financial Crimes Enforcement Network (FinCEN) seeking data regarding financial services offered to minority cannabis businesses.

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The legislators want better insight into barriers faced by minority cannabis business owners.

Minority cannabis entrepreneurs often refer to a lack of access to capital and financial services as a major barrier to entering the legal cannabis industry. In their request for information, Lee and Blumenauer cited a 2021 Brookings Institution report that revealed determining Black-owned businesses faced more disparities in access to banking services and deposits, mortgage credit, and small business loans than their white counterparts.

The legislators also referred to a 2021 Federal Reserve report showing Black- and Latino-owned businesses were less than half as likely as their white counterparts to be fully approved for loan applications.

“As momentum for marijuana decriminalization continues, FinCEN data could help shed light on the state of minority-owned and small cannabis businesses (which constitute businesses with revenues under $40 million) seeking financial services,” the lawmakers wrote in the letter to
FinCEN Acting Director Himamauli Das. “Existing disparities in access to capital and financial services for individuals and businesses increase financial barriers and exacerbate the racial wealth gap, further harming those most harmed by the failed War on Drugs.”

The legislators said Congress must devise a federal solution to equitably end cannabis prohibition and encourage industry growth.

“As we work to invest in the communities disproportionately harmed in the failed War on Drugs, FinCEN data on access to financial services could help promote equitable access to financial services for small and minority-owned cannabis businesses,” Lee and Blumenauer concluded.