Just as cannabis businesses have struggled to find a bank that will accept their deposits, they have also have been challenged to find a lender for a business loan. That is now changing with lenders that have opened up to cannabis businesses with loan products that traditional low risk businesses have had access to for years.
For example, cannabis businesses now have access to business cash advances which they can use for working capital, inventory, equipment, marketing, new locations or whatever is needed. Some lenders require as little as 3 months in business and verification of income with 3 months of business bank statements with a minimum of $10,000 in monthly income. These advances are qualified and funded quickly – 3 days for an approval and a week for funding into your bank account. To get a better idea of the qualifying criteria that a lender will review for your business, you can review this pre-qualification form at http://bit.ly/2xpABGt-bus-cash-advance
For cannabis businesses that have tapped out their friend and family network along with their credit cards, a new option has emerged – private lending groups that cater to the cannabis industry. Cannabis business cash advances are one option as we discussed but there is also lending for cannabis related equipment leasing and purchasing along with cannabis commercial real estate financing. Due to the high risk nature of lending to the cannabis industry, cannabis businesses can expect to pay a bit higher in terms of rates or the overall cost of the loan.
Can you get a cannabis business loan at the bank you are currently banking your deposits with? Sometimes, yes. However, more often, no or very limited. Why? Most banks and credit unions are concerned with Federal compliance with bank loans and have decided not to wade into these waters. Others, such as Salal Credit Union in Washington State offer their cannabis business members commercial real estate financing on par with traditional financing in terms of lending requirements. However they do not offer lending for working capital and equipment financing.
It is more difficult to find a direct lender for cannabis business loans however there are Independent Sales Organizations (ISO’s) that represent cannabis direct lenders that are more accessible. These ISO’s will often represent multiple cannabis lenders thereby providing multiple funding options with a greater chance of approvals and agreeable loan costs.
Ken Higgins is CEO of NewVista Financing and his focus is helping cannabis businesses attain the financing they need to sustain and expand their operations. Contact Ken at firstname.lastname@example.org and learn more at https://mjbusinessloans.com