About INB

What role does your company play in servicing the cannabis industry and how did that start?  

INB started its program in 2019 after hearing stories about and researching the movement of cash in the industry. Management believed it could create a program that would provide a secure solution to the movement in cash and give licensed operators access to some traditional banking services previously unavailable to many Illinois cannabis-licensed businesses.

We offer most of our traditional deposit services to licensed operators by working with couriers who specialize in cash-in-transit services designed specifically for the licensed-cannabis trade. We have offered loans on a limited and very conservative basis when there is real estate involved.

As a bank working in the cannabis industry – which is still not legalized at the federal level – explain how INB is able to operate here in Illinois.

The US Department of Treasury issued guidance through its Financial Crimes Enforcement Network (FinCEN) that set certain rules for banks who are receiving cash proceeds from or suspected to be tied to cannabis-related sales in states with licensed sales. INB’s primarily regulator, the Office of the Comptroller of the Currency (OCC) is also a division in the US Department of Treasury, each of which do not necessarily condone the open banking of cannabis-related cash, but require the bank to comply with the rules established by FinCEN and other traditional anti-money laundering regulations.

Why did INB get involved in the cannabis industry?

There are very few industries facing cash-logistic challenges like the cannabis industry. Banks were built to keep depositors’ money safe and provide financial services to protect the flow of its customers hard-earned gains. Our management team prides itself on finding innovative solutions for our customers and being on the forefront of new technologies and financial solutions. While INB started with a small, community bank charter, it began essentially as a start-up operation in the Capitol City and grew to compete with many older, established financial institutions

What excites you about the cannabis industry?

The cannabis industry presented an opportunity to meet new people who also faced unique challenges as they grew their businesses from the ground up in a heavily regulated industry much like the heavily regulated financial industry. The energy our licensed cannabis customers present when they discuss the unique paths to finding capital, building their operations and their difficulties working solely with cash is contagious. We share the excitement and relief that many of our customers experience when they feel the liberation that our cash logistics and banking services provide.

What are the biggest challenges facing your business?

There is a lack of diversity of services, which presents monopolies on pricing for certain services. Debit cards remain an issue, despite our continued pursuit with Visa to open their rails to licensed-cannabis operators. Loans are often difficult to extend because they are harder to wind-down if our regulators or the federal government changes its (somewhat) hands-off approach to banks in the cannabis space. We can close checking accounts, but we cannot really just exit loans that easily. This is a challenge for every bank looking to bank the cannabis industry. Loans are also difficult to make without real estate collateral, and the value of the collateral is hard to ascertain for very specialized projects such as cannabis cultivation and dispensaries (no standard appraisal rules or bases for cannabis industry operations).

As a company that services cannabis businesses, how has CBAI membership been valuable?

The Association can lobby for many of the obstacles we also face, but the education and access to other resources provide additional avenues for greater knowledge that can benefit our existing customers.