GFA Federal Credit Union to Serve Recreational Marijuana Companies
Construction on the GFA Federal Credit Union in Gardner. (Michael Swensen for The Boston Globe)
GFA Federal Credit Union, founded in 1938 to serve French-Canadian immigrants and headquartered in Gardner, Mass., will become the first credit union in the state to offer banking services to recreational marijuana companies. This will allow consumers to pay for pot with plastic and helps cannabis businesses avoid the expensive and risky proposition of running all-cash operations.
Other banks and credit unions have so far stayed on the sidelines, calculating that it’s legally and financially risky to handle the proceeds of cannabis sales as long as the drug remains illegal at the federal level.
Tina Sbrega, GFA’s chief executive, said her credit union concluded it could legally — and profitably — provide banking services to marijuana operators, and that doing so would improve public safety.
“We’re looking at a cannabis business as a legitimate business that wants to be recognized as such and that, without banking services, presents a tremendous public safety issue in our communities,” Sbrega said. “Otherwise, you’re talking millions and millions of dollars of cash on the street.”
GFA’s move comes as a relief to many stakeholders in the cannabis industry. Companies licensed by the state to grow, process, and sell marijuana had been preparing to count and securely store large quantities of paper money — and plotting out the logistics of paying employees, vendors, and state tax-collectors in cash.
Now they should be able to transfer those funds electronically, like most other businesses, and also accept debit cards from shoppers at the register. Perhaps most importantly, companies won’t need to direct workers to handle and transport large sums of cash.
Steve Hoffman, the chairman of the Cannabis Control Commission, also hailed the news, saying it should alleviate concerns about crime — and encourage more entrepreneurs to enter the pot industry, in turn providing consumers with greater choice and accessibility.
Hoffman met repeatedly with GFA, reassuring the credit union that the state would closely monitor the movements of marijuana products with its “seed-to-sale” tracking system and enforce stringent regulations on cannabis companies and their employees. Currently, he said, the commission is having similar conversations with several other banks and credit unions that are preparing to enter the recreational space.
“It’s a real big deal that GFA decided to enter this industry,” Hoffman said in an interview. “I expect that it’s going to look like other states, where once the first institution dips its toes in the water, there will be others that follow.”
To launch the new business, GFA is incorporating a new subsidiary and partnering with Safe Harbor, a Colorado-based company that contracts with financial institutions to help them vet potential cannabis clients and meet strict federal rules for handling marijuana money. For example, banks and credit unions must file “suspicious activity reports” to the US Treasury’s Financial Crimes Enforcement Network, or FinCEN, detailing every marijuana-related transaction.« RETURN TO ALL NEWS