First Class Cannabis Group: Financing Solutions Maintain Industry Growth
The drawn-out delay in overhauling federal banking regulations has led to the creation of private lending firms like First Class Cannabis Group.
With sweeping legalization across the United States, the cannabis industry has made some serious strides over the past few years. Thirty-six states have now legalized medical marijuana, and 28 states, plus Washington DC, have legalized cannabis for recreational use. However, a cloud of uncertainty persists when it comes to cannabis finance and banking. Finding cannabis finance solutions and securing cannabis loans can be challenging.
Cannabis is big business. New Frontier Data estimates the legal cannabis market will be worth $51 billion by 2025. And yet, as it remains illegal on the federal level, larger banking institutions and payment processing companies have opted out of serving cannabis companies, leaving many cannabusinesses caught in a no-man’s land between state and federal law.
There are some progressive lawmakers taking action to move things forward though. In 2019, the House of Representatives passed the Secure and Fair Enforcement (SAFE) Banking Act, but it floundered in the Senate. The bill would ensure that in states where marijuana is legal, federally regulated banks would be allowed to work with cannabis companies to provide funding and access to banking systems.
And yet, Congress has so far failed to lift banking restrictions on cannabis companies operating in full compliance of the law. The impact of this lack of progress at the federal level means businesses must rely on cash, which causes a number of problems for cannabis business owners, such as the inherent dangers of dealing with enormous amounts of cash. The lack of access to bank funding and loans also means cannabis companies have limited access to capital, which negatively impacts their potential for expansion.
This has created an opportunity for a small group of financial services companies to provide cannabis loans to businesses requiring capital to expand operations. This includes things like paying for inventory and new equipment; making real estate purchases and build outs; and hiring new employees.
First Class Cannabis Group (FCCG)is a full-service cannabis-related lending firm designed to provide financing solutions* in this unique lending space. As traditional financing options are not available to finance cannabis businesses, founder Joseph Anthony recognized a need to provide short- and long-term financing to help farmers, growers, dispensaries and ancillary companies achieve their goals.
What separates us from the rest of the cannabis and hemp lenders in the United States and Canada is our ability to think outside the box and our depth of resources in a unique market,” Anthony said.
FCCG’s focus is on achieving long-term goals while keeping an eye on the short-term needs of business owners. With the click of a button, they offer completely custom financial solutions, including:
Merchant Cash Advances that provide quick access to capital for uses such as inventory, bridge funding, payroll or other expenses/opportunities that require immediate action.
Equipment Financing for upgrading to the new equipment.
Accounts Receivable Funding that takes the guesswork out of financing by providing financing on a 30-day rolling term.
Banking Solutions and Merchant Bankcard Services to ease the pressures of dealing in cash.
Unsecured Working Capital that’s customized with the needs of the borrower in mind. FCCG is one of the only funders in the cannabis industry to provide this financing option to licensed operators and ancillary companies.
“We hope that the Government can take the lead from companies such as ourselves to provide a foundation for the cannabis industry to survive over the next decade,” Anthony said.
*First Class Cannabis Group takes a fee for all loans provided to valid borrowers. Fees are dependent on credit score, revenues, cash flow, accounts receivables, accounts payables, inventory, value of real estate and equipment in determining the amount of any loan.