(This is an abridged version of a story that appears at Marijuana Business Daily.)
The U.S. Small Business Administration updated its lending guidelines with new rules that could have a major impact on businesses servicing the cannabis industry – and not just those on the marijuana side.
The revised guidance, published in early April, prohibits banks from issuing SBA-backed loans to any company that has a direct business relationship with a cannabis or hemp firm.
For hemp-related businesses, any company that “grows, produces, processes, distributes or sells products purportedly made from hemp is ineligible unless the business can demonstrate that its business activities and products are legal under federal and state law. Examples of legal hemp products include paper, clothing and rope.”
The new rules could have big implications for firms with business operations that extend beyond cannabis. For example, landlords who lease space to marijuana-related firms would not qualify for an SBA loan.
Click here to read more about how the new guidelines will affect direct and indirect marijuana-related business.
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