Finding the Right Maryland Loans to Grow Your Cannabis Business

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Contributor, Benzinga
February 22, 2023

Do you operate a cannabis business in Maryland? If so, you have a unique opportunity to expand, thanks to recent legislation that legalizes recreational marijuana as of July 1, 2023.

Existing dispensaries will have the upper hand in tapping into this new market but will likely require business financing to make the transition. Here are the best ways to secure a growth loan in Maryland for a cannabis business.

Cannabis Business Opportunities in Maryland

Maryland recently voted to legalize small amounts of recreational marijuana starting on July 1, 2023. Of course, “small” is a relative term, and the Cannabis Public Policy Consulting group estimates that Marylanders will soon consume 1.8 million pounds of cannabis each year, a number higher than the average of other states.

That’s good news for existing Maryland cannabis business owners. Current provisions allow medical dispensaries to sell recreational quantities of cannabis, though the recent decision will open the door for small, boutique-style retail locations.

Maryland’s Cannabis Business Assistance Fund 

The recent changes to Maryland marijuana laws are also designed to promote social equity through the Cannabis Business Assistance Fund. This fund would empower small minority- or women-owned cannabis businesses in Maryland through financial or application assistance.

If you represent an underserved community, you may be able to receive financial assistance to expand your business.

What to Look for in Maryland Cannabis Lending Partners

The right financing can help you expand your cannabis business to take advantage of the new recreational marijuana market in Maryland. What should you look for when pursuing Maryland loans for your cannabis business?

Multiple Lending Options

Ideally, you’ll want to find a lender who provides multiple avenues for financing. That way, you can choose a lending option that best fits your needs and offers favorable repayment terms.

ERTC Advance Loans

Employee retention tax credit (ERTC) loans are part of a specialized loan program based on the employee retention credit program introduced during the 2020 pandemic. If your business retained employees throughout 2020 and 2021, you might be eligible for a business credit as high as 70% of qualifying wages.

Other restrictions apply, so check with your lender to see whether you qualify.

Working Capital

Working capital loans are used to fund the day-to-day operations of your cannabis business. These Maryland loans are ideal for ensuring you have the cash flow to maintain your business, but they can also provide the working capital to power your operation as you expand or open new retail locations.

Equipment and Vendor Financing

Equipment loans and vendor financing are loan programs designed to help you secure or maintain your equipment and procure additional inventory. As you make the transition to the recreational cannabis market, these Maryland loans can help you add additional sales equipment or purchase new inventory to reach your new market.

Accounts Receivable and Lines of Credit

A business line of credit may be a flexible option for cannabis business owners who aren’t certain of their exact financing needs.

A line of credit works much like a consumer credit card, providing a rotating financing option rather than a lump-sum payment. The only drawback is that the financing amounts tend to be low, and the interest rate can be higher than a traditional loan.

Financing Amount

It’s vital to find a lender who can provide the financing or loan amount you need. Make sure you compare multiple lenders and choose one who can fully cover the loan you need to tap into this new market.

State Law Compliance

You’ll also want to make sure your lender offers loans that reflect current Maryland laws concerning the sale of cannabis products.

For instance, Maryland is attempting to focus on state-approved cannabis businesses to avoid black- or gray-market sellers, so make it a point to find a lender who understands the licensing requirements associated with cannabis businesses.

Understanding of the Marijuana Industry

The best lenders will understand the changing business trends in the cannabis industry along with the legal regulations affecting it. The right lender can connect you to financial solutions that help you adapt to a changing market and guarantee that you obtain financing that aligns with your business goals.

Financing Solutions for Cannabis Companies in Maryland

Cannabis legalization has been a slow, state-by-state process, with no uniform federal governance of how cannabis businesses are run. For this reason, obtaining bank loans and financing from traditional lenders have historically been reluctant to offer small business loans to cannabis business owners.

While that may change as more states legalize recreational marijuana, cannabis businesses must pursue alternative lenders to launch, maintain or expand their operations.

Cannabis lenders understand the needs and challenges unique to the cannabis industry and can help you navigate a transition to a recreational marijuana business.

Adapting to a Changing Business Climate

As Maryland adapts to recreational cannabis legalization, existing cannabis businesses will find new opportunities. With the right business lending, you can adapt your business to thrive in a growing and highly lucrative market. Obtaining a Maryland small business loan can help accelerate business growth, it's worth looking into your financing options today!

Frequently Asked Questions


What is the cannabis law in Maryland?


Starting July 1, 2023, small amounts of recreational marijuana will be legal in Maryland for people 21 and older. Cannabis sellers must be licensed by the state of Maryland.


How much does it cost to start a cannabis grow facility in Maryland?


Getting a cannabis grow facility up and running can be costly. Cannabis cultivation licenses cost a total of $6,000 ($2,000 for Stage 1 and $4,000 for Stage 2), and cultivators will pay an annual licensing fee of $125,000 per year in addition to other operational costs.


How much does it cost to open a dispensary in Maryland?


Medical dispensaries require a $5,000 application fee plus an additional $40,000 annual licensing fee. As recreational marijuana rolls out, fee structures may change for businesses selling or distributing recreational cannabis products.