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Banking On Hemp & CBD with First Business Bank

By Theresa Wiese, Managing Director of Compliance and Risk Management


For more than 40 years, the federal government classified hemp and CBD (cannabidiol) oil as Schedule 1 narcotics banned by the Controlled Substances Act. However, hemp and CBD, derived from the same plant as marijuana, contain either none or very little THC (tetrahydrocannabinol), the active ingredient in marijuana.

Late last year, the 2018 Farm Bill made an important distinction between marijuana, hemp, and CBD, making hemp legal and setting the stage for each state to create hemp production pilot programs. As a result, more and more entrepreneurs are starting hemp and low, or no THC CBD-related businesses requiring business banking solutions. The CBD industry is booming — in fact, retail sales of CBD are estimated to hit $16 billion by 2025.

In 2019, a significant amount of confusion in the banking industry has arisen regarding whether, and if so, how, banks will accept hemp and CBD-related entities as clients. Recently two U.S. Senators sent letters to several federal banking and financial regulatory institutions urging them to facilitate financial access for industry businesses.

“While some banks have agreed to offer financial services to the growing hemp industry, many banks have not due to confusion over the legal status of hemp,” the senators wrote. “However, as hemp is no longer a controlled substance, banks should feel secure in engaging with this industry…Legal hemp businesses should be treated just like any other businesses and not discriminated against.”

It was important to us act quickly to help address the financial needs of these companies in Wisconsin and Kansas. First Business Bank focuses primarily on banking, deposit, and loan needs of business-to-business companies processing hemp including CBD oil in Wisconsin and Kansas only.

Banking with First Business

As a financial services firm that embraces entrepreneurs, we’ve worked quickly to determine our standards for banking in the hemp and CBD industry. First Business Bank’s current clients include growers and producers who process hemp and CBD oil in Wisconsin and Kansas. Unfortunately, due to differing state laws and licensing requirements, we don’t currently work with online and brick and mortar retailers. Among several considerations and requirements, First Business Bank:

  • Requires a hemp grower and/or processor license and registration prior to account opening
  • Will ask for information such as: prospective customers, whether the business is transporting hemp or CBD oil across state lines, the type of CBD products the business is making or selling, information about the business’ suppliers and their licenses, sources of the hemp, and more.

NOTE:  Merchant card processors may not offer debit and credit card processing to hemp and CBD industry businesses due to various licensing and THC requirements.

Located in WI or KS?

Reach out to First Business to learn about the process of establishing deposit accounts and banking services for your hemp and/or CBD business.



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