Cash is still king in the medical marijuana industry. But the industry is growing desperate for a change – a change to mainstream credit card use.
Accepting credit cards for medical marijuana is spotty at best. Some small, regional banks have the ability to process transactions for such, but certainly not without an element of fear. The progress toward such is undeniable, however. Since the state of California legalized marijuana use for medicinal purposes in 1996, 29 states and the District of Columbia followed (eight states have legalized marijuana use for recreational purposes).
Still, mainstream, universal credit card use for medical marijuana remains elusive.
Instabill CEO Jason Field attended the 5th Annual Marijuana Business and Conference Expo Nov. 16-18 in Las Vegas, and payment solutions for medical marijuana merchants remained a big issue. It seems to be every year.
What is the Problem?
Marijuana remains a Schedule I substance – along with heroin, LSD and ecstasy – which categorizes substances that are at high risk for abuse (Schedule 5 drugs such as Tums or Robitussin have the least potential for abuse). In the eyes of the federal government, marijuana is still illegal to grow, sell or use.
Legalization on the state level is progress, and the Feds have deferred to state governments to oversee themselves. Two things need to happen, however:
- Marijuana needs to be declassified as a Schedule 1 substance.
- The U.S. federal government needs to quell the fears that banks have of being shut down for offering payment processing to marijuana merchants.
3 Reasons Why We’re Optimistic About Credit Cards for Medical Marijuana
Back to our point about progress in the use of credit cards for the purchase of medical marijuana. Here’s why we’re optimistic:
- Massachusetts, Maine, Nevada and California: Four more states legalized recreational use of marijuana in the Nov. 8 election, making for 29 states that have legalized it for medicinal or recreational purposes. With more states joining in, surely payment solutions must improve.
- Perception continues to change: More and more, marijuana is looked upon as a viable alternative to pain management. In fact, the use of CBD, the non-psychoactive substance in marijuana, is growing increasingly popular as a health supplement.
- FinCEN’s Statement: FinCEN, the Financial Crime Enforcement Network of the U.S. Treasury, released a statement of ‘best practices’ in February 2014 for banks to offer merchant services to medical marijuana merchants. Legislation in the U.S. doesn’t move fast, but this was an indicator that better payment solutions are forthcoming.
About Our Offshore Medical Marijuana Payment Solution
Through an international banking partner, Instabill has a credit card processing solution or medical marijuana merchants. Find out more about it by speaking with one of our merchant account managers at 1-800-318-2713.