Cannabis Entrepreneurs have expressed their frustrations at erratic financial and regulatory systems that are failing businesses, customers and patients.
One of the main issues U.K. CBD businesses currently experience is with the poorly functioning banking system. While the situation there is not as drastic as the U.S., where some employ security companies to ferry cash to suppliers, it is still a running sore for many.
Not one for the Banks
He said: “CBD banking is difficult, It’s too great a risk for U.K. High St banks. I’ve sat down with a regional manager, at one the leading banks, and they are fully aware of the whole situation, but are too worried about the ramifications."
Jon-Paul Doran, CEO of U.K., cannabis cultivator Eco Equity agreed that banking is an obstacle most encounter, describing the situation in the U.K as 'a joke’.
One panelist recounted in a discussion on ‘Cannabis Entrepreneurship’ how his business had been rejected by Forex, how it had taken 26 weeks for him to secure a basic account and how he had to establish a separate subsidiary company, unconnected to cannabis, to perform transactions.
Whilst it’s lawful to sell CBD in the U.K. entrepreneurs say the banking compliance officers balk at any connotations with cannabis - which is illegal. Consequently, their conservative nature makes them congenitally averse to anything perceived as risk - something they perceive that may come back to bite them at a later date.
Hair Falls Out
Geoff Miller, CEO and founder of private equity firm CannFi Group, says institutional financial compliance officers’ ‘hair falls out at mention of cannabis’. This conservative approach is also prevalent in other areas of the CBD and cannabis industry says Tony Fowler, the founder of the O’Shaughnessy Drink Company.
He was referring to the torturous U.K. cannabis growers' licensing regime, and how its regulations stipulate for the destruction of cannabis flowers. He also called for stricter regulations on the sale of CBD products in the U.K. “I cannot wait for it,” he said. “People are coming into the industry with a Gung-Ho attitude; making all sorts of wild claims about their products and they don’t give a damn about the long-term credibility of the industry. This is an amazing industry, with great future potential and we are in it for the long haul, but some just don’t care and are in it simply for the dollars.”