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Did you know that finding a bank for your cannabis business is like riding a roller coaster without the safety bar? Sure, things start out great. But before you know it you’re clicking up up up to the top of the crest. Then it’s a heart-stopping vertical drop of 300 feet, and losing your phone is not the worst thing that can happen. Oh no. It can turn nasty. The same is true about banking. Without that Safebanking legislation that everyone has been waiting for, you’re stuck with storing your ill-begotten weed money in your mattress and paying the light company with a wheelbarrow full of 10s and 20s. This is no way to run a business. So what’s a plucky cannabis upstart to do? In this episode, we travel back to the Michigan Cannatech Expo and chat with Mike Kozak, VP, Director of Commercial Business Development at Union Bank. I met Mike at the Michigan Cannatech Expo and grilled him on cannabis banking and how they’re able to provide FDIC accounts for cannabis businesses.
Safe Banking for Cannabis Businesses
At the end of 2021, Union Bank completed its third full year of providing deposit banking services to Michigan’s Cannabis industry. While this line of business has brought significant deposits and revenue to the Bank, these benefits come with regulatory, reputation, and operational risks. Although medical and adult-use marijuana is legal in Michigan, marijuana is still a Schedule 1 drug, making it illegal at the
Federal level.
The marijuana industry in Michigan is evolutionary and has moved at an extraordinary pace. Many cultivation, processing, and testing facilities opened in 2021, which enabled the market to meet the demand for medical and adult use. Michigan’s unlimited licensing structure encourages new businesses and competition, which will continue to drive prices down
Union Bank has become well-known within the Cannabis market, resulting in new customer referrals. As the Bank’s customer base expanded, the Bank installed an internal software monitoring system that enables staff to monitor the onboarding of new customers efficiently. Additionally, the system tracks all sales and deposit activity to identify and minimize risk.
How to Connect with Mike Kozak
Mike is the Director of Commercial Business Development for Union Bank, a wholly owned subsidiary of Union Financial Corp that operates full-service offices in several Grand Rapids-area communities. Part of his role is managing the Cannabis Banking Group for Union Bank. He oversees all of the bank’s cannabis-related customer relationships providing these customers with cash management solutions, commercial loans, consumer loans, and consumer banking. He has nearly 30 years of financial industry experience including prior roles at Fifth Third Bank and Huntington Bank.
Reach out and connect with the links below:
Website Union Bank 515 East Centre Portage, MI 49002
Phone: (616) 374-3278
Email: mkozak at ubmich.com
Michigan Cannatech Expo
The Michigan Cannatech Expo was held May 3rd and 4th at the Soaring Eagle Resort. It is the largest Cannabis Business Expo and Conference in the Midwest. As the midwest continues to evolve in the Cannabis business, hemp, laws, and regulations, it was an opportunity for industry professionals to gain information on this challenging and expanding market. The tradeshow contained over 40,000 Square feet of the top Cannabis Industry Suppliers exhibiting the latest in Cannabis production technology. Attendees were able to see the latest cultivating and processing technologies for cannabis and hemp. The conference also hosted seminars led by industry experts covering licensing, production, banking, hiring, and more. This yearly cannabis community is an event worth attending.
Cannabis Advocate Podcast
The Cannabis Advocate podcast advocates for businesses in the cannabis industry and explores the unique challenges they face. Despite hurdles in legislation, regulation, and culture, there are tremendous opportunities for growers, manufacturers, and retail sellers of cannabis products. Many of these issues are unique to the cannabis industry. This podcast speaks to these common concerns and shares stories of success.
This is a production of Habanero Media. https://habaneromedia.net
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