Payment solutions for marijuana businesses, both medical and recreational, remain elusive despite its legalization in 29 states (eight with legalized recreational use). As a long time payment services provider for high risk industries, Instabill has been aggressively pursuing the possibilities for credit card processing for marijuana business transactions.
Truthfully, we really thought there would be a credit card processing solution by now. We believe most merchants, PSPs, ISOs and others in the payments and marijuana industries thought the same. We recall reading a news item that suggested formation of a government-run credit union specific to payment solutions for marijuana businesses, medical and recreational.
It made perfect sense: Under US federal law, use, possession and sale is illegal (superseding the 29 states that now say otherwise). A credit union created and overseen by the government is a viable (and profitable) solution and a start. Think of the possibilities.
As long as the federal law remains firm, however, it seems the card issuing giants will not budge.
CBD, Hemp, Paraphernalia: We have merchant account solutions
As payment processing for marijuana businesses – other than straight cash – remains virtually non-existent, payment solutions for marijuana-related businesses have resources. We offer CBD merchant accounts as well as merchant accounts for hemp businesses, both domestic and offshore. At this time, however, we can only offer merchant accounts for CBD and hemp merchants with payment processing history.
Unfortunately, we are currently unable to accommodate startup CBD/hemp merchants as well as merchants seeking solutions for marijuana seeds. The business of all things marijuana remains delicate with acquiring banks remaining lukewarm about the industry.
We’re very hopeful of partnering with an international acquiring bank that offers solutions for startups in the very near future.
Payment solutions for Marijuana: What lies ahead?
With Election Day just passed, we had read up on several states that may join the growing list of those states which legalized marijuana for medical and recreational purposes. Here’s which states we feel could be next in the legalization of medical and/or recreational marijuana:
- Vermont: Far along in the legislative process.
- New Jersey: Phil Murphy, who is pro-legalization, will replace Chris Christie as governor in January.
- Arizona: Recreational use nearly passed in 2016. Can’t be long.
- Michigan: Use for adults over 21 is up for a vote in 2018. In Detroit, its largest city, two medical marijuana reform ordinances passed overwhelmingly.
- Rhode Island: Used Massachusetts as its test, legalization is favorable soon.
- Connecticut: Taxation and regulation similar to its alcohol laws.
- Ohio: Possession was overwhelmingly de-penalized.
- Virginia: New Governor Ralph Northam wants to decriminalize.
Investing in marijuana…and armored transportation
While marijuana remains a straight cash business, it has been a major boon to the armored car/transport business, particularly in those states where recreational use has been legalized. Marijuana sales are expected to grown by 17 percent year over year, and reach more than $13 billion per year by 2020.
The possession and transport of such volumes of cash – we’ve read about dispensaries in Colorado make 3-5 retrievals and drops per day – simply isn’t safe.
What is the best way to do payment processing for marijuana businesses? Leave us a comment below.