Newsroom
NCUA issues additional information, FAQs on hemp banking
The NCUA issued a Letter to Credit Unions yesterday to provide additional information for credit unions that are serving, or considering serving, legal hemp-related businesses amid the coronavirus pandemic. The letter does not impose additional requirements or expectations on credit unions.
“It is important that credit unions stay current with the federal, state and Native American tribal laws and regulations that apply to any hemp-related businesses they serve,” wrote Chairman Rodney Hood in the letter. “The information in this letter is not an interpretation of the USDA’s interim final rule or other applicable federal or state laws, and does not provide definitive guidance related to the various legal requirements applicable to credit unions that want to provide financial services to hemp-related businesses.”
The Letter to Credit Unions includes FAQs ranging from the status of USDA hemp-related rules, whether a credit union can provide loans to a hemp-related business, and if NCUA examinations conducted in 2020 will cover hemp.
The NCUA in 2019 released interim guidance allowing federally insured credit unions to provide certain financial services to legally-operating hemp businesses as hemp-derived products became legal at the federal level under the 2018 Farm Bill. Other banking regulators later released similar guidance after the U.S. Department of Agriculture (USDA) issued an interim final rule in October that outlines provisions for legal hemp production.
According to the 2019 release from the agency, further guidance will be released once the United States Department of Agriculture finalizes forthcoming regulations and guidelines.
The issue of providing financial services to hemp businesses is separate from that of serving marijuana-related businesses (MBRs). While NAFCU has not and will not take a position on the legalization or decriminalization of marijuana, the association has several resources on the issue and continues to encourage Congress to consider legislative complexities as several states have legalized the drug.
In a Compliance Blog post earlier this year, NAFCU Regulatory Affairs Counsel Kaley Schafer reviewed the current landscape of marijuana banking and provided insights into how the presidential election could impact the possibility of federal legislation. In addition, NAFCU has released an issue brief that provides credit unions with comprehensive, up-to-date information on federal legislative efforts and state-level marijuana laws.