New York Governor Andrew Cuomo is giving a boost to the budding industrial and medical hemp industry in the state.

The Democrat is directing the Department of Financial Services to provide guidance for banking services to support those businesses.  The directive encourages financial institutions to develop relationships with the industries that are operating in full compliance with state law, including the Compassionate Care Act.

Bob Joseph/WNBF News file photo

Fellow Democrat, Donna Lupardo of Endwell issued a statement:

“This is a very positive development for New York’s medical marijuana and industrial hemp industries. As I’ve traveled across the state, this has been one of the main challenges facing our growers, processors, and investors. ”

Hemp growers and processing facilities have run into obstacles in developing the industry since, while medical marijuana and industrial hemp does not contain the hallucinogenic compounds of the smokable drug, marijuana currently is still listed on Schedule I under the Federal Controlled Substances Act. That has been causing problems in establishing banking relationships with regulated financial institutions.

Under the Governor's directive, DFS will not impose any regulatory action on any New York State chartered bank or credit union for establishing a banking relationship with a medical marijuana-related business that operates under state law.

Lending institutions must verify the eligibility of the business for participating in an authorized research program that is overseen by the New York Agriculture and Markets Law and, as with any other loan consideration, should conduct appropriate risk and underwriting reviews.