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Underwriting

What documents do cannabis underwriters require?

Short answer

Expect to provide state and local licenses, formation and ownership documents, government ID and background information for beneficial owners, bank statements, financial statements, processing statements if you have them, your compliance and AML procedures, product and supplier information, and website or menu details.

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The fuller explanation

Underwriters are assembling a file that must satisfy the sponsor institution's due diligence program. Missing or inconsistent items are the most common cause of delay — for example an ownership structure on the application that does not match the license, or a lease that names a different entity.

Prepare the pack before you apply and keep a maintained copy. Cannabis accounts are re-verified periodically, and operators who can produce current documents within a day tend to keep accounts through policy reviews that catch others out.

Standard document pack

  • Active state license(s) and any local permit or certificate of occupancy.
  • Articles, operating agreement and current cap table or ownership disclosure.
  • ID and background details for owners above the disclosure threshold.
  • Three to twelve months of bank statements and recent financials.
  • Prior processing statements and any termination notices.
  • Written AML/KYC, security and record-retention procedures.
  • Product list, supplier and testing documentation where relevant.

Important caveats

  • Thresholds for owner disclosure vary by institution, and some require disclosure of indirect owners.
  • Inconsistent entity names across documents will stall a file faster than a weak financial.
  • Some providers require site photos, camera coverage evidence or a virtual walkthrough.

Other ways people ask this

These phrasings share the same answer, so they live on this page rather than on duplicate URLs.

  • Cannabis merchant account document checklist
  • Underwriting requirements for dispensaries
  • What paperwork do payment processors need from a cannabis business?

Sources

  1. BSA Expectations Regarding Marijuana-Related Businesses (FIN-2014-G001)

    FinCEN, U.S. Department of the Treasury · checked

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Where this fits

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  2. 2Why is my processor holding a percentageA rolling reserve is a percentage of your settled volume that the provider withholds for a set period — commonly a single-digit percentage held for three to six months — and releases on a rolling schedule. It protects the provider and sponsor bank against refunds, returns, disputes and losses, and it is a real cash flow cost to the merchant.
  3. 3our analysis of cannabis payment underwritingAn underwriter reviewing a cannabis or hemp application is answering one question: if we support this merchant, what is the chance we have to unwind it, and what…

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