Cannabis Industry's $130B Growth Potential: Top States For Investment As Financial Institutions Set To Earn Billions In Interest Revenue, New Report Reveals

Benzinga · 10/15 14:09

A new report released on Tuesday projects that the U.S. cannabis industry will need between $65.6 billion and $130.7 billion in sustainable growth capital to support new cannabis businesses and help refinance existing ones over the next decade.

The report from Whitney Economics and backed by CTrust and Green Check said the market will generate roughly $1 billion to $2.4 billion in potential interest revenue for financial institutions willing to lend to cannabis businesses, over the same period.

The U.S. cannabis retail sales are expected to grow from $28.8 billion in 2023 to $87 billion by 2035, according to the published analysis. To fuel the growth, the U.S. cannabis industry could add 25,000 to 30,000 licenses to approximately 40,000 current licensees.

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"The funding needed to realize this growth cannot be supported solely by friends and families," said Beau Whitney, WE founder and chief economist. "By demonstrating regional opportunities and broader market potential, the report aims to empower financial institution lending departments to help educate their boards on risks, rewards and opportunities—all in the hopes of accelerating the industry's growth by encouraging more financial institutions to participate."

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Whitney revealed at last week's Benzinga Cannabis Capital Conference in Chicago that total retail sales for the cannabis industry are expected to reach approximately $32 billion in 2024, with the potential to double within the next few years.  

“We’re forecasting a 2024 total retail sales of around $32 billion,” the economist said at the event.

According to Whitney, the growth of the cannabis industry is contingent upon legal consumer participation and the number of licenses issued in various states.

The new report also highlighted California, Florida, Illinois, New York, Pennsylvania and Texas as the top states for financial funding opportunities over the next decade.

"This report should pave the way for conversations with financial institutions to develop more informed lending partnerships with the cannabis industry,” Dotan Y. Melech, CEO and co-founder of CTrust, said.

Kevin Hart, founder and CEO of Green Check Verified, agrees.

"This report is crucial for our customers, as an integrated platform of compliant deposits, account monitoring and portfolio management opens the entire industry up nationally," Hart said. "Connected data, visibility, opportunity and managed risk are essential for building a robust financial ecosystem that supports sustainable growth in cannabis lending.”

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