Cannabis & Currency | Cannabis Payment Processing in 2021 and How to Do It Like the Pros

credit card processing for marijuana companies
Cannabis has gone from the street corners to dispensaries, as these days, a lot has changed about the devil’s lettuce that we love. One other thing that has changed is how we process payments for cannabis, which is the topic of this article.

It’s been quite a long journey for cannabis. From the world’s biggest enemy for America’s war on drugs to something with a genuine clinical application, the fight to legalize cannabis has been long and hard, and even if countries are warming up to cannabis, the hard work is yet to come.

Now that cannabis is legal for medicinal and recreational use in some places, dispensaries are popping up everywhere.

Since eCommerce has been playing a pivotal role in the sales of anything, it’s only natural to assume that eCommerce dispensaries would pop up all over the place – and they did. This gave new life to cannabis banking and cannabis payment processing, which is what we’ll explore in this article.

The Cannabis Industry

The cannabis industry has grown a lot since it became a thing. The legal distribution of cannabis for either recreational or medicinal purposes is a complex thing on its own, but payment processing is a whole other beast.

It’s estimated that by 2025, the total worth of the global cannabis industry will skyrocket to a mind-boggling 43 billion dollars. This, by itself, is a significant industry. Since it’s just getting off the ground, many current corporate frameworks and infrastructures will need to adapt to cannabis, and with that come the law and legislation regulating cannabis itself.

Cannabis and Cash | Why Not Use A Card?

Well, if you want to purchase some cannabis with a card, that would solve most of your issues, wouldn’t it? Sadly, it’s impossible to accept traditional payment methods such as credit and debit cards as payment for cannabis products on the merchant side of things.

The fight for the legalization of cannabis is long, hard, and arduous. Due to the semi-legal status of cannabis across the entire world, payment processing services such as AMEX, Discover, VISA, and MasterCard aren’t allowed to process such payments.

Considering that the four are the most popular payment services on the market, especially VISA and Mastercard, which share most of the market, that’s a big problem.

Why not use a card? You can’t – it’s illegal. So, if using the most popular payment processing services is out of the question, what do you do? Well, you turn to cannabis payment processing platforms.

Cannabis merchants are struggling to find the right platform for their payment processing, but that is also getting easier with the industry’s growth. Cannabis growers have the same issue – so before the cannabis question is fully resolved in the entirety of the world or at least a major country such as the US, there will have to be workarounds.

What Workarounds Are There?

With the pricey prospect of cannabis, there are bound to be cannabis payment service providers that make the sale of cannabis a breeze. Most of them operate out of specific locations where cannabis is legal, and some larger corporations utilize an umbrella model, having a different branch serve different places.

Cannabis credit and debit card processing have to go through a ‘middle man’ so they can function properly. These kinds of cannabis merchant solutions are pretty tough to come by, mainly because the laws around cannabis are so prone to change.

As the good fight continues to rage on, the cannabis question will likely be settled in the future, and there will be no need for specialized cannabis banking providers. However, knowing the law and just how long the cannabis question has been discussed could be years or even decades before we see some results.

As a merchant, you’ll have to utilize a cannabis banking solution to help you with the payment processing regarding selling cannabis and cannabis-related products.

The Future of Cannabis Payment Processing

You can consistently accept cash or bank transfers, but these don’t really work if you’re looking to offer instantaneous service and payments, especially if you’re running a digital dispensary.

Cryptocurrencies had faced a similar issue before they resolved it with stable coins, and the cannabis industry is using a similar workaround. In layman’s terms, it pegs something to the value of a FIAT currency and then exchanges that for cannabis, meaning that the procurement and sale of cannabis were never actually done with real money.

In Conclusion

Convenience, scalability, reliability, and safety are the biggest concerns of cannabis merchants. With cannabis payment platform providers, all of those can be satisfied in an abundance of ways that make the sale and purchase of cannabis a piece of trippy cake.