Donovan gives SAFE Banking Act update at Canna Biz conference

October 15, 2021

CUNA Chief Advocacy Officer Ryan Donovan spoke about credit union support of the Secure and Fair Enforcement (SAFE) Banking Act at the Credit Union Association of New Mexico’s Canna Biz conference this week. The SAFE Banking Act would provide a safe harbor and other protections for financial institutions serving legal, cannabis-based businesses.

CUNA became the first national trade association to support the bill in 2019, which Donovan said is part of CUNA’s overall advocacy strategy to revolutionize the operating environment for credit unions.

“A successful advocacy agenda marries needs of credit unions in public policy space with the political realities, and our end goal isn’t to get a bill signed into law, or change a regulation, but to make it easier for credit unions to serve their members,” Donovan said. “

The bill passed the House earlier this year and was also successfully added to the House-passed FY22 National Defense Authorization Act.

“The defense bill is going to pass, so getting something attached to that in the House means you’re in pretty good shape,” Donovan said, “but we face a lot of challenges in the Senate,” adding that the Senate is looking at SAFE Banking along with other legislation for full decriminalization and expunging records of those with cannabis convictions, all of which are priorities for Senate Majority Leader Chuck Schumer (D-N.Y.).

“The real concern is that is appears the Senate is positioning the perfect to be the enemy of the good,” Donovan said, noting that several Democratic members of the Senate are insisting on decriminalization legislation as opposed simply fixing the banking issue.

Donovan highlighted that public support for decriminalization has gone up in recent years, which will make it easier for Congress to act, but that today Congressional support is insufficient to enact decriminalization legislation.

“I have confidence that at some point, probably in next four years, the cannabis banking issue will be resolved at federal level,” he said. “I have equal confidence that the fundamental dynamics of how the Justice Department approaches this will be unchanged over the same period of time.”

But despite recent movement, Donovan noted, credit unions have been engaged on this topic since 2012, when Colorado and Washington first legalized recreational cannabis. That’s when credit unions on those states started reaching out to CUNA, which did not have any formal policy yet on cannabis banking.

CUNA and League engagement on this topic started with technical assistance as policymakers wrote the bill, all the way through testifying in support of the bill before House and Senate Committees.