The Medicinal Cannabis (R)evolution

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4.2 Challenges and Opportunities for the Commercial Banking Sector The legalisation of medicinal marijuana brings with it many opportunities for the banking sector (Figure 4). It is anticipated that there will be opportunities for increased revenue from services offered to medicinal cannabis businesses. Additionally, given the resources associated with monitoring these types of accounts, there are also opportunities to ensure that the fees are commensurate with the risk profile of the customer. At a country level, the development of the industry presents the opportunity to enhance the legislative framework governing money laundering and terrorist financing in an effort to mitigate associated risks. This includes a robust legal framework to ensure that only licensees conduct medicinal marijuana related business. Section 5 of the report lays out the legal framework for various licences which can be issued to persons engaged in the medicinal cannabis industry. Financial institutions should ensure that adequate due diligence is conducted, by verifying that customers engaged in the industry are duly licensed, in keeping with the domestic medicinal cannabis legislation.

Figure 5: Challenges and Opportunities for the Commercial Banking Sector

Despite the potential benefits, there can be challenges associated with banking the proceeds from medicinal cannabis ( see Figure 5 ). The foremost challenges are the resources required to ensure that controls are adequate to monitor and manage the funds derived from medicinal cannabis, and restrict the transfer of these funds to jurisdictions where medicinal cannabis remains illegal.