Market Expansion Potential: Safe Harbor anticipates that the rescheduling of cannabis to Schedule III and the passage of the SAFER Banking Act will encourage over 4,700 state-chartered banks to reconsider servicing cannabis-related businesses, significantly expanding its total addressable market.
Compliance Service Advantage: Safe Harbor's fully managed compliance service enables financial institutions to quickly and compliantly serve cannabis-related businesses across 41 states, enhancing its competitive edge in the fintech sector.
Tax Burden Relief: Under Schedule III, Safe Harbor's clients will no longer pay 280E taxes but will instead adopt a normal tax regime, which could materially improve their cash flows and subsequently enhance Safe Harbor's investment income and lending capacity.
Reduced Borrowing Costs: The interest expenses for cannabis businesses will become tax-deductible, lowering their after-tax cost of debt, which will enable them to borrow more from lenders like Safe Harbor, further driving revenue growth for the company.
SHFS
$1.51+Infinity%1D
Analyst Views on SHFS
About SHFS
SHF Holdings, Inc. is a service provider to offer compliance, monitoring and validation services to financial institutions, providing traditional banking services to cannabis, hemp, CBD, and ancillary operators. Its services include regulatory compliance consulting and software for maintaining Know Your Customer (KYC) and Bank Secrecy Act compliance to financial institutions, principally conducted vis-a-vis its proprietary financial services platform and the origination, onboarding, verification, and servicing of cannabis-related deposit business for and on behalf of its partner financial institutions. Its services also include sourcing, underwriting, servicing, and administering loans issued to cannabis businesses and related entities, which are often also its customers and being customers of its partner financial institutions. Through the Company’s platform, its financial institution clients can provide cannabis-related businesses (CRBs) with access to traditional financial services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
