Credit unions can serve hemp businesses, NCUA says
New guidance from the National Credit Union Administration will allow federally insured credit unions to offer certain services to legally operating hemp businesses.
The guidance comes at the request of Senate Majority Leader Mitch McConnell, R-Ky., who contacted the NCUA about challenges that hemp farmers in Kentucky face around accessing capital.
“Lawful hemp businesses provide exciting new opportunities for rural communities,” NCUA Chairman Rodney Hood said in a statement on Monday. “I believe today’s interim guidance keeps with the mission of the nation’s cooperative credit system to serve people who have been overlooked and underserved."
Hood continued that his expectation is that CUs will be thoughtful when considering their abilities to serve lawfully operating hemp-related businesses.
Hemp contains low concentrations of tetrahydrocannabinol (THC) and higher concentrations of cannabidiol (CBD), which lowers cannabis' psychoactive effects.
Credit unions are permitted to provide standard financial services, such as business accounts and loans, to legally operating hemp businesses.
“I’m delighted to hear the NCUA has answered my call on behalf of Kentuckians to ensure the legal hemp industry can access much-needed financial services,” McConnell said in a statement. “Although President Trump signed into law my initiative last year to remove hemp from the federal list of controlled substances, many of my constituents have told me about their difficulty receiving loans and other services that are necessary to successfully run a hemp business.”
Once the Department of Agriculture finalizes upcoming regulations and guidelines, the guidance will be revised.
The National Association of Federally-Insured Credit Unions praised the move, with President and CEO Dan Berger saying in a statement, "This guidance will provide credit unions more certainty as they work to help their members. As noted in the guidance, credit unions must make a business decision as to whether to serve hemp businesses that are legal under federal law and, at a minimum, have strong risk measures in place, including ensuring they follow all Bank Secrecy Act requirements."