The number of banks in the United States willing to lend to hemp producers can be counted on one hand. That is about to change.
Federal and state bank regulators announced Tuesday that they were scrapping a burdensome requirement that banks said kept them away from the hemp business. Banks will no longer have to treat their hemp customers as suspicious and file reams of paperwork to anti-money-laundering authorities for each interaction.
The change could provide a major boost to a niche product that began its own legalization process last year.
“Banking has been an ongoing problem,” said Erica McBride Stark, the executive director of the National Hemp Association, a trade group for growers. “So this actually should be quite helpful.”
Hemp products are made from the same plants that produce marijuana, but they are cultivated to have far less tetrahydrocannabinol, or THC, the chemical that produces a “high” when ingested. The plants’ stalks can be woven into fabric and their seeds processed into oils used in food, but they cannot be made into drugs.
Even so, federal law long considered hemp to be as forbidden as cocaine and heroin. [Read More @ The NY Times]