Fintech firm Dama Monetary has acquired approval from the Los Angeles Workplace of Finance to supply hashish companies a approach to pay metropolis taxes and licensing charges with cash.
Beforehand, the choice of cash funds had been suspended on account of coronavirus.
The All-Money Drawback
Earlier than the COVID-19 outbreak, hashish companies had been allowed to pay taxes by bank card, ACH, or cash by appointment. Many hashish companies would select to do it in cash, since hashish corporations are sometimes denied entry to banking providers, and deal with most of their transactions in cash.
However for the reason that coronavirus outbreak, Los Angeles suspended cash cost appointments with a purpose to keep social distancing. This left many hashish companies with out an choice to pay taxes and licensing charges, stopping town from amassing a portion of hashish taxes.
The “All-Cash Problem” is among the trade’s most suffered regulatory hurdles, because it blocks hashish companies from accessing fundamental baking providers. This ends in companies dealing with extreme safety hazards, being compelled to spend further in non-public safety, whereas difficulting fundamental operations like payroll and tax funds.
The SAFE Banking Act, a invoice that handed a Home vote final 12 months, might remedy this subject by defending monetary establishments who select to work with hashish companies from receiving federal punishment.
With the brand new partnership between Dama Monetary and Los Angeles, greater than 300 hashish companies within the metropolis can use Dama’s “CashToTax” platform to rearrange for cash to be picked up by armored courier and deposited right into a devoted FDIC-Insured account, from which tax and charge funds may be made on-line.
“The Metropolis of Los Angeles Workplace of Finance is happy with Dama Monetary’s means to assist our cash paying hashish companies at a time once we are navigating an unprecedented disruption,” mentioned Claire Bartels, Director of Finance for town.
Lead picture by Ilona Szentivanyi. Copyright: Fintech Zoom.
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