The pot banking business was already booming for the North Bay Credit Union and a new partnership could go even further.
Chris Call, President and CEO of North Bay Credit Union
The $ 92 million asset credit union recently signed an agreement to make the California Cannabis Industry Association a premier employer group, which means any legal marijuana business in the member state of the CCIA will automatically be eligible for membership in North Bay. While the credit union was already serving pottery stores across the state by qualifying them for memberships through donating to other SEGs – a common method of bypassing SEG-based membership restrictions – l agreement with the state trading group should help facilitate this process.
North Bay has been offering marijuana banking services for about three years now, and although these companies only represent about 2% of its total membership base, they account for about 20% of total deposit activity, the CEO said. Chris Call. On top of that, growth jumped in 2020, with assets rising by around 35%, most of which came from cannabis accounts.
“During the pandemic, a lot of our cannabis accounts really took off,” Call said. “A lot of people who were staying there relied on the pot to get through difficult and anxious times, so [legal pot shops] did very well and had a lot of money to put down, so it’s been a good year for them.
Last year’s growth is not expected to slow down anytime soon, he added. “Even if the pandemic were to end tomorrow, only the acceptance and growth of the cannabis trade and industry – and consumer acceptance of it – continues to grow.
North Bay only provides banking services to cannabis companies and does not lend to those stores, Call said.
Despite being a small credit union, Call said the legal marijuana industry has been a thriving niche market for North Bay because “as a small credit union we can adapt faster and better. effectively than a large institution could with some of the challenges of cannabis. banking.”
Part of this has required strengthening its compliance team in recent years, including the Bank Secrecy Act and anti-money laundering experts, ACH specialists and more, all working “almost hand in hand. with our regulator to make sure they are comfortable with what we are doing. This is complemented by technological tools that have helped North Bay be more efficient, such as the BSA software for filing suspicious activity reports and a system linked to the state’s cannabis traceability program.
With all of this in place, Call said the credit union doesn’t expect to have to recruit new compliance officers to handle any additional risk from new businesses joining the CCIA partnership.
“The reason we are doing this is to ensure public safety in our local community,” Call said. “It’s not really about making a ton of money or promoting cannabis in any way; we got involved because we wanted to promote public safety and we feel we have done a good job in that regard. We took almost $ 1 billion off the streets of our local community and put it into the financial system it belongs to. “
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