SEATTLE, WA – MARCH 14: As employees advise clients on the more than twenty strands available at A Greener Today, a popular cannabis store in Seattle, one client uses the in-store ATM to retreive cash, on March 14, 2014 in Seattle, Washington. Because federal laws still prohibit the sale of legal cannabis, stores don’t have access to the banking system and have to conduct all business in cash, which creates security issues. With legal medical cannabis allowed in over 20 states, and recreational use allowed in two (Colorado and Washington), the legal cannabis market is primed to expand dramatically. Privateer Holdings, a private equity firm that invests only in legal medical and recreational cannabis markets, has already raised over 50 millions dollars from investors, effectively bringing cannabis to Wall Street (Photo by Gilles Mingasson/Getty Images).
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The cannabis industry is standing at a regulatory crossroads. With the DEA’s rescheduling hearings underway and set to conclude July 15, 2026, and the SAFE Banking Act reintroduced in Congress, the financial services landscape for cannabis businesses is poised for its most significant transformation since states began legalizing medical use.
But for the financial institutions and technology providers that serve this sector, the question isn’t whether change is coming—it’s how to prepare for a future where cannabis looks more legitimate but remains legally complicated.
Here is how five key players in the cannabis banking ecosystem are getting their clients ready.
The Rescheduling Reality
On April 22, 2026, Acting Attorney General Todd Blanche signed a final order moving state-licensed medical marijuana and FDA-approved cannabis products to Schedule III of the Controlled Substances Act. This represents the most significant federal review of cannabis policy in more than 50 years.
Yet as Joshua Radbod, co-founder and CEO of the PBC Conference, points out, the change comes with significant caveats. “Rescheduling helps legitimize the industry and should bring more financial institutions to the table for depository banking and direct lending to operators,” Radbod says over email. “Financial institutions that prepare now, building out compliance and cannabis-specific expertise, will be best positioned as access gradually expands.”
But he warns that the legal landscape remains murky. “As it currently stands, rescheduling only applies to medical cannabis not adult-use, and there are many states that have legalized both medical and adult use, and within those states some operators offer both medical and adult-use products under one roof, so it’s going to be interesting how this legally shakes out.”
The Hemp Precedent
Tony Repanich, president and CEO of Shield Compliance, a compliance technology company that helps financial institutions serve regulated high-risk industries, sees parallels to another federal policy shift. “Looking at the potential impact of medical cannabis rescheduling, we believe the best comparison may be the hemp industry following passage of the 2018 Farm Bill,” Repanich says via email. “That legislation established a federally recognized pathway for hemp and unintentionally opened the door for intoxicating hemp products, creating opportunities for new investment, innovation, product development, payment solutions, and financial services participation.”
He expects medical cannabis rescheduling to produce similar effects – increased interest from financial institutions, lenders, payment providers, researchers and ancillary service providers. However, he notes two important distinctions: medical cannabis will remain largely confined to individual state markets, preventing a truly national commercial framework, and there will likely be a much greater emphasis on clinical research and pharmaceutical development.
From a banking perspective, Repanich expects the greatest impact in medical-only states and markets where medical and adult-use operations are clearly separated. “While rescheduling may encourage some new financial institutions to enter the space, we do not anticipate a dramatic influx given the relative size of the medical market,” he says. “Instead, we expect gradual improvements in access to credit, continued expansion of banking services, and increased discussions around traditional payment acceptance for medical operators.”
The Compliance Burden Remains
For financial institutions navigating this uncertain terrain, one thing is clear: the compliance requirements aren’t going away.
Abby Kaufmann, commercial director for CRB Monitor, a provider of cannabis-related business intelligence for financial and regulatory compliance, explains that her company was founded in direct response to the 2014 FinCEN Guidance, which introduced a framework for financial institutions servicing the legal cannabis industry. “Our database features comprehensive business profiles that include full marijuana license details, enforcement actions by regulatory agencies, and information on the seemingly unrelated businesses and related parties—all of which are what FinCEN Guidance instructs financial institutions to collect and refresh on an ongoing basis, regardless of where marijuana sits in the CSA,” Kaufmann says via email.
She notes that although the Cole Memo that prompted this guidance was rescinded in 2018, the FinCEN Guidance and its requirements for marijuana-related Suspicious Activity Reports remain unchanged. “FinCEN Guidance explicitly states that a financial institution is required to file a SAR on activity involving a marijuana-related business, in accordance with this guidance and FinCEN’s suspicious activity reporting requirements and related thresholds,” she says. “As such, and in the absence of updated guidance from financial regulators, rescheduling alone will have little to no impact on the resource-intensive nature of cannabis banking or on the need for sector-specific tools.”
Kaufmann sees both promise and peril. “In a perfect world, the move to Schedule III will lessen the perceived risk—both reputational and regulatory—associated with cannabis banking and, in turn, encourage FIs that have been on the fence to begin servicing the industry or serve as a catalyst for cannabis-friendly institutions to enter the cannabis-lending ecosystem.”
But there is another possibility. “If there is a pathway for cannabis businesses to be federally legal—whether that ultimately only applies to state-licensed medical businesses or to the substance as a whole—new cannabis banking programs or even existing programs could decide to only service those with DEA registration to offset their risk exposure, resulting in little to no upside for the remainder of the industry.”
According to Kaufmann, the answer to whether cannabis banking will change post-rescheduling isn’t a question of “if” but “in what way” and, critically, “when.” “After the DEA Hearings conclude on July 15th, numerous petitions for judicial review and lawsuits are expected,” she says. “Financial institutions face nearly as much regulatory scrutiny as cannabis businesses themselves and will be hard-pressed to make informed, risk-based decisions or policy changes amid this level of regulatory uncertainty.”
No Light Switch Moment
Erin O’Donnell, CEO and co-founder of the Association for Cannabis Banking and co-author of the book “Cannabis Banking: Legal Frameworks and Practical Solutions for Cultivating Compliance,” shares a similar view. “My general view is that rescheduling will be meaningful, but it will not be a light switch moment for cannabis banking,” O’Donnell says via email. “It may change the economics, reduce some stigma, and encourage more serious planning by banks, fintechs, and service providers, but cannabis will still require specialized compliance, strong BSA/AML controls, transparent payments oversight, and clear risk governance.”
She emphasizes that the operational burden isn’t going away. “Rescheduling may change the business case for cannabis banking, but it will not eliminate the need for cannabis-specific compliance. Banks and service providers are preparing for a market where cannabis looks more legitimate, but still requires enhanced due diligence, careful monitoring, payments transparency, and examiner-ready documentation.”
“The service providers who will be best positioned after rescheduling are not the ones promising that cannabis banking suddenly becomes easy,” O’Donnell adds. “They are the ones building infrastructure that helps financial institutions understand the customer, follow the money, document the risk, and support payments in a way that regulators can understand.”
She frames the challenge in practical terms: “Rescheduling may open the door for more financial institutions to reconsider cannabis, but it does not remove the operational burden. Cannabis banking still sits at the intersection of BSA, payments, state licensing, federal uncertainty, and reputational risk. That means education, controls, and transparency will matter more, not less.”
Solving the Operational Puzzle
For many financial institutions, the barrier to entering cannabis banking hasn’t been regulatory approval—it has been operational complexity.
Justin Fischer, CEO and co-founder of RiskScout, a compliance and fraud prevention technology platform that has helped manage some of the largest cannabis banking programs in the US for dozens of community banks and credit unions, sees this as the core challenge. “Many institutions have wanted to bank cannabis for years but held back due to federal scheduling concerns,” Fischer says via email. “The barrier for those institutions isn’t just regulatory approval, it’s operational—they don’t want to bolt on a new system or hire a whole new team just to enter the space.”
His firm’s approach has been to embed cannabis banking workflows directly into existing fraud and AML solutions. “Our approach of embedding cannabis banking workflows directly into our existing fraud and AML solutions has helped ease the transition for bankers hoping to avoid operational headaches,” Fischer explains.
The Path Forward
As the industry awaits the outcome of the DEA hearings and potential movement on SAFE Banking, the message from service providers is consistent: prepare now, but prepare for complexity.
Repanich sums up the current sentiment: “While regulatory uncertainty remains, we anticipate greater competition as more financial institutions come off the sidelines to serve this industry. As a result, financial institutions and their technology partners are preparing now by building more flexible compliance programs, enhancing underwriting capabilities, and developing products that create deeper customer relationships. The institutions that are planning for change today will be better equipped to capitalize on tomorrow’s opportunities.”
The cannabis banking ecosystem is evolving, but it is not being revolutionized overnight. For financial institutions and the service providers that support them, the winning strategy is not waiting for clarity—it is building the infrastructure to thrive in uncertainty.
