Sativa Steve (L) handles a transaction while Rachel gives a smell to a customer in a medicinal cannabis shop in San Francisco on June 7, 2005. People with a doctor's recommendation and a card from the California Department of Public Health can purchase from the store.The Supreme Court dealt a blow to the medical marijuana movement 6/6, ruling that the federal government can still ban possession of the drug in states. (UPI Photo/Terry Schmitt) | License Photo

An employee prepares a "joint" for sale in a medicinal cannabis shop in San Francisco. People with a doctor's recommendation and a card from the California Department of Public Health can purchase from the store.The Supreme Court dealt a blow to the medical marijuana movement 6/6, ruling that the federal government can still ban possession of the drug in states. (UPI Photo/Terry Schmitt) | License Photo

DENVER, Jan. 11 (UPI) -- Colorado legislators say they plan to propose a sort of credit union to back medical-marijuana dispensaries.

The medical-marijuana industry in the state is already subject to the most comprehensive set of regulations in the country, but the proposed "financial cooperative" would greatly ease financial operations for businesses, legislators said.


State Sen. Pat Steadman told The Denver Post the bill would plug a hole in Colorado's medical-marijuana regulations.

"The inability to have a financial institution to do their banking with really hinders regulatory enforcement," Steadman, a Democrat, said. "So it's in everybody's interest that these people don't have piles of money lying around … and, instead, there's a paper trail."

Because of federal insurance regulations, banks are often hesitant to work with businesses that deal in medical-marijuana.

In October 2011, the last bank in the area to openly work with the businesses closed their accounts in a rash of closures out of fear of violating the Controlled Substances Act.