Cannabis & Hemp Banking

Photo of cannabis products.The SDBA takes no position on the moral issues raised by legalizing marijuana. But with the passage of Amendment A and Initiated Measure 26 legalizing medical and recreational use of marijuana in South Dakota, the SDBA remains committed to supporting its member banks during this transition. At this time, there are a lot of unknowns as the South Dakota Legislature is required to provide statutory framework and administrative rules must be formalized.

Federal and state laws continue to conflict regarding legality of cannabis use and sale. That also means that it remains illegal at the federal level for banks to serve businesses working directly and indirectly with the cannabis industry. Current proposals in both the U.S. Senate and the House seek to provide greater clarity and bridge the gap between state and federal law provide a solid starting point for discussion. 

Here is where things currently stand in South Dakota:

  • Initiated Measure 26 legalizing medical marijuana in South Dakota will go into affect on July 1, 2021. The South Dakota Departments of Health and Education are creating and will operate the new regulatory program. The state of South Dakota has launched the Medical Cannabis in South Dakota website to answer questions and provide information about the medical cannabis program. 
  • A bill to authorize banks to engage in business with industrial hemp or marijuana licensees and associated persons has passed both houses of the 2021 South Dakota Legislature, and Gov. Kristi Noem signed the bill on March 25, 2021. 
  • On Feb. 8, 2021, the Sixth Judicial Circuit Court ruled Amendment A (recreational marijuana) unconstitutional. An appeal is pending before the South Dakota Supreme Court. 

SDBA Webinar Recording:
Cannabis/Hemp Banking 101 Webinar

After a flurry of activity surrounding cannabis during the 2021 South Dakota Legislature, medical marijuana will become legal on July 1, 2021. Is your organization ready to bank the industry? The SDBA hosted the Cannabis/Hemp Banking 101 Webinar on Jan. 20-21, 2021. If you were not able to take part and are now looking for more information, the SDBA is extending the invitation to watch the recorded webinar. To see session details, click here. To purchase the recorded webinar for $275 and request the link to watch it, click here.

Cannabis Resources

Hemp Resources

Educational Resources

  • American Bankers Association: The ABA provides a wealth of information on its cannabis banking webpage
  • Colorado Bankers Association: Colorado was the first state in the country to legalize recreational cannabis use, and the Colorado Bankers Association has been on the forefront of the issue. Visit the CBA's cannabis webpage.
  • OnCourse Learning: The SDBA’s webinar partner, OnCourse Learning, has a variety of on-demand webinars addressing the topic of marijuana. Visit www.bankwebinars.com, click on the search option and enter “marijuana”. 

The SDBA will continue to research this issue and keep you apprised of additional resources. Questions, contact the SDBA at 605.224.1653 or email SDBA President Karlton Adam at [email protected].