Shield Compliance, a platform for cannabis banking, unveiled its annual survey results, and results are showing a disconnect between financial institutions and the cannabis industry.
Their findings show that despite evolving regulations and shifting attitudes toward cannabis, banks and credit unions struggle to meet the specific needs of cannabis-related businesses.
Persistent Challenges In Cannabis Banking Services
To begin with, Shield Compliance found that 83% of respondents are satisfied with the customer service received. But there’s more to this finding. Researchers found that most respondents are unlikely to refer other cannabis-related businesses to their bank or credit union. This is a significant given that recommendations are a much reliable way of measuring client satisfaction.
This reluctance is telling a different story on how banking is serving the cannabis industry: there’s a potential disconnection between service satisfaction and the overall banking experience for cannabis businesses.
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Discontent With Services Provided
The survey revealed mixed feelings about the available banking products and services, with only 54% of respondents satisfied.
Also, a significant 53% expressed dissatisfaction with high fees and service charges.
On the product side, for cannabis operators, vital financial needs include access to operating lines of credit, equipment financing and real estate loans – all essential services yet difficult to secure.
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Future Expectations And Industry Growth
Optimism remains high among operators, with nearly 80% expecting the profitability of the cannabis industry to remain steady or improve in the coming years.
However, the survey indicates a decline in financial institutions’ understanding of the cannabis sector. Only 63% of operators say their financial institution grasps the nuances of their industry—a decrease from previous years.
Erin O’Donnell, co-founder of the American Cannabis Bankers Association, pointed out the growing need for specialized training and certification for financial institutions. This would bridge the knowledge gap and potentially enhance the banking experience for cannabis companies.
“These findings underscore the opportunity for financial institutions to create deeper customer relationships and gain an even greater competitive advantage as competition intensifies in the years ahead,” O’Donnell said.
Tony Repanich, president and CEO of Shield Compliance, added that “adoption of technology that integrates data can streamline the compliance burden for financial institutions while creating a consistent, dependable experience for operators”
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