Last week California’s state senators approved a cannabis banking bill that could prove to be a framework for other states in the U.S. where cannabis has been legalized. While SB930 still has a number of steps to clear before coming a state law, the proposal provides a game plan for state and plant-touching businesses to do business without the constraint of paying for literally everything in cash. Let’s take a look.

With cannabis still being illegal on the federal level –a stance that’s eroding in popularity on both sides of the political aisle– plant-touching businesses within California and other states where pot is legal for medicinal and recreational purposes are forced to use cash for payments on things such as rent, supplies, equipment, et cetera. SB930 proposes the sensible solution of establishing a limited-purpose charter bank within the Golden State that would provide accounts and checkbooks to businesses to pay for things such as rent, supplies, equipment, et cetera with a paper check versus the inconvenience of carrying around bags of cash a la the Monopoly Man.

The present arrangement of “cash only” is not a viable long-term solution for the state, nor legal and licensed businesses within the state. More bluntly, a cash only state of affairs is, if anything, contributing to the thriving black and gray markets of quasi-legal and illegal plant-touching businesses across the state. Is it too bold an expectation for this proposed limited-purpose charter bank solution to require would-be member businesses to prove their compliance and licenses when first applying? For them to prove compliance and licensing on an annual basis? With state and local authorities taking new measures to curb black market businesses on a seemingly weekly basis these days, such an effort could potentially encourage more businesses to come into compliance with the state for the assured convenience and growth potential that comes with actual brick-and-mortar banks that are backed by the heft of the state of California. Or, they could just keep on paying for everything in cash.