A recent survey conducted by the Wisconsin Bankers Association (WBA) showed that approximately 50% of banks that were not servicing the hemp industry in 2019 would extend their services to the hemp customers in 2020.
Besides, the typical economic questions, the WBA’s annual Bank CEO Economic Conditions Survey had three questions that were hemp-related. The queries responses show that many of the banks in Wisconsin better prepared to transact with the hemp sector.
The WBA President and CEO, Rose Oswald Poels, explained and said that the Wisconsin community bankers are working to serve their customers and communities better. And since hemp is a new crop with complex issues from the standpoint of regulation and business, it is taking them a bit longer to work through the intricacies. This is because all banks cannot adopt a one-size-fits-all approach since each bank’s strategy and timeframe will vary.
In November of 2019, the federal regulators issued their first guidance for financial institutions on hemp banking.
Thirty-eight percent of the banks that participated in the WBA survey are already accepting deposits from hemp businesses. However, only a lesser percentage of the banks, 15% to be precise, are giving out loans to hemp-related companies.
Some of the banks are not offering their services to hemp-related businesses because customers have not requested them for these services.
Poels further said that Wisconsin enjoys a diverse banking industry, which ensures that customers and businesses are allowed to choose a banking relationship that serves their unique needs. He also said that they encourage the people to contact bankers until they find the bank that fits them.
According to the respondents of the WBA survey, banking opportunities for hemp-related business will be more in 2020.
The hemp industry is relatively new, and farmers, as well as businesses, are trying to find answers to the questions about the crop, such as the cost of growing, price, yield, profits, contracts, and markets. This shows that the banking industry is not the only business working through complex issues regarding hemp. More data and information needed by companies and bankers will continue to increase as the sector grows, making it easy for them to make decisions and navigate easily from both a regulatory and operational standpoint.
Community banks are working together with hemp-related customers to find ways to help their businesses grow. The safest place for consumers and businesses to keep their money in Wisconsin is the bank.
The WBA survey was conducted within the first two weeks of December, and there were 85 respondents.