LOS ANGELES, CA--(Marketwired - February 18, 2014) - MediSwipe, Inc. (www.MediSwipe.com) (MWIP), the leader in Compassionate Care Technology Solutions and products for the medicinal marijuana industry, today announced a new memorandum issued Friday by the U.S. Departments of Treasury (DOT) and Justice (DOJ) giving long-awaited guidance to financial institutions, such as banks and credit unions, to provide financial services to marijuana-related businesses within states of legal jurisdiction. Under the rules, banks must verify that marijuana companies are properly licensed by the state before pursuing a business relationship.
The medical marijuana and recreational marijuana industries are in the early innings of a major adoption phase which are expected to result in $20 billion in revenue in the coming years. Approved in 20 states and D.C., and with endorsements from high-profile doctors such as Dr. Sanjay Gupta, more states will soon come on line and continue to increase the size of the market.
A long time refusal to engage in financial services has plagued medical marijuana businesses for years, dating back to the Bush Administration. Due to an aggressive accelerated policy under the Obama Administration, states like California, Colorado, Washington, Michigan and others have been forced to deal with "cash only" transactions. The memo issued on Friday by the Financial Crimes Enforcement Network (FinCEN) and the DOJ seeks to clarify customer due diligence expectations and reporting requirements for financial institutions seeking to provide services to marijuana businesses. The memo also includes clarity for credit card service companies, such as VISA and MasterCard, whose services for medical marijuana-related businesses had also been suspended for years. The new guidelines clearly begin laying out a path for banks to bring marijuana commerce out of the shadows and into the mainstream financial system.
Nearly all of the more than 1,000 licensed dispensaries in California and Colorado have been forced for years to operate on a cash-only basis, considerably increasing the risk not just for the affected medical marijuana businesses, but also for the tens of thousands of patients who have been left with the cash-only option to obtain their medication.
"While this is a huge step in the right direction, there is still much work to be done to ensure that legal marijuana businesses will not be prosecuted in the future," said Rep. Jared Polis, a Boulder Democrat leading an effort to remove marijuana from the Controlled Substances Act and place it under the regulatory arm of Alcohol Tobacco and Firearms.
Similarly, U.S. Rep. Ed Perlmutter, a Democratic member of the House banking committee, said he'll continue pressing legislation to allow banks to legally do commercial businesses with cannabis storefronts.
"The administration's move on Friday to start the outline of a blueprint for the banking industry to do business with legal marijuana sellers within regulated jurisdictions, is the first in a series of important steps that could further legitimize the burgeoning industry. For the first time, legal distributors will be able to secure loans and set up checking and savings accounts with major banks that have largely been barred from doing so for some time with these businesses. This ground breaking decision eliminates a key hurdle facing marijuana sellers, who can now legally conduct business in 20 states. It is our hope in the near future as these banking guidelines are more defined, MediSwipe can once again play an important role as a financial services provider between the banks and the medicinal sector utilizing prepaid patient cards, merchant services and mobile payments for medicine," stated B. Michael Friedman, CEO of MediSwipe.
Financial firms could be handsomely rewarded for banking legal marijuana business. The legal U.S. industry is expected to reach $2.57 billion in sales this year, according to ArcView Market Research.
About MediSwipe, Inc.
MediSwipe, Inc. (www.MediSwipe.com) provides innovative patient solutions and is the leader in Compassionate Care Technology for the medicinal marijuana industry. MediSwipe provides terminal-based service packages and integrated Web Portal add-ons for physicians, clinics, hospitals and medical dispensaries that include: digital patient records, Electronic Referrals, Credit/Debit Card merchant services, and health and wellness product lines including beverages, vaporizers and accessories.
This press release may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the Safe Harbor created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and subject to risks and uncertainties. Such forward-looking statements by definition involve risks, uncertainties and other factors, which may cause the actual results, performance or achievements of MediSwipe, Inc. to be materially different from the statements made herein.