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A study released this week shows that Oregon residents, by an overwhelming majority, feel working with the marijuana industry does not damage the reputation of financial institutions. The survey also indicates banks and credit unions might enhance their standing and attract new customers in Oregon by working with the cannabis industry.
The survey, conducted by LT Public Relations (LTPR) and DHM Research, suggests financial institutions could bolster their image by making loans to marijuana businesses in Oregon. LTPR works with financial, healthcare and professional services organizations. DHM is an opinion research company. Both are based in Portland, Ore.
Because federal law designates marijuana as an illegal drug, many banks have refused to give business loans or issue credit to cannabis businesses. But another concern, according to the report, is “reputational risk” — the damage working with marijuana companies could do to the bank’s standing among other customers.
The report found those fears are largely unfounded in Oregon. Of those surveyed, 87 percent said they would not have a negative view of their bank or credit union if they provided services to marijuana-related business.
“Though the uncertainty of federal laws and regulations may still be valid reasons for financial institutions to delay providing financial services to marijuana businesses, this research indicates reputational concerns are largely unfounded,” the report states.
Researchers surveyed 800 Oregonians between Nov. 10 and Nov. 17. Some of the findings included:
- 44 percent said their view of a financial institution would actually improve if it did business with marijuana-related companies.
- Only 12 percent said they would view a bank negatively if it provided services to a marijuana-related business.
- Marijuana proved more popular than other industries among respondents, who said they would view a financial institution more negatively if they worked with “big box” stores (25 percent), pharmaceutical companies (38 percent), oil companies (41 percent) and tobacco companies (48 percent).
- Among those 35 years old or younger, 88 percent said they view the cannabis industry favorably and 62 percent said their view of a financial institution would improve if it worked with the marijuana industry.
- Only 38 percent saw federal laws making marijuana illegal as a good reason for a bank or credit union not to do business with a marijuana-related company.
- Respondents had far more positive views of credit unions (91 percent positive) and regional banks (86 percent positive) than they did national banks (just 16 percent positive).
Are these opinions widespread?
Clearly, the survey results show people in Oregon do not have a negative view of doing business with marijuana companies. Of course, Oregon is among a handful of states that have approved recreational marijuana. The others are Alaska, Colorado, Washington, California, Massachusetts, Nevada and the District of Columbia (Maine voters also approved recreational marijuana, but a recount is underway).
Are the attitudes of those in the survey reflective of other states where marijuana is legal? The report offers a big “if,” saying that “if attitudes of Oregonians are a good barometer, then financial institutions in states where recreational marijuana is legal may have stronger reasons to enter the market than they do to abstain — at least from a reputational standpoint.”
Both LTPR and DHM, while touting the changing attitudes toward marijuana that the survey indicates, said in the report that banks and credit unions should carefully consider “their brand and mission” before providing financial services to marijuana-related businesses.