It was difficult not to be optimistic about the possibilities for cannabis payments at MJBizCon 2018 in Las Vegas two weeks ago, particularly for merchant services providers anxious for the opportunity to offer dispensary merchant accounts.
Recent events indicate the U.S. is moving (albeit slowly) in the same direction as Canada as far as legalization for recreational cannabis use. Don’t be mistaken – U.S. officials (especially the FDA) are tracking every detail about the now booming cannabis industry to the north. We’ll go as far to say Canada is the U.S.’s litmus test of sorts, and that it’s a matter of time before cannabis becomes federally legal.
There are not-so-subtle signs everywhere:
- Ten states have legalized it for recreational use, with Michigan the latest state. There are 31 states where it’s now medically legal after the November midterm elections.
- The STATES Act, up for consideration in 2019, could enable legal states to have legitimate banking services and immunity from federal prosecution.
- World Health Organization exploring the possibility of re-scheduling cannabis from a Schedule 1 drug (currently, it is in the same class as heroin, LSD and other far more powerful narcotics).
- A growing number of states considering legalizing recreational cannabis: New Jersey, Delaware, Rhode Island, Connecticut, New York among them.
One of the presentations we attended at MJBizCon, The Globalization of Cannabis: Trends and Opportunities, addressed what we can expect from the industry within the next three years.
Edibles and vape (and less smoke)
Recently we blogged about the purchasing experience at a legal dispensary in Las Vegas. One of the surprises of the experience was the variety of edible and vaping products, which outnumbered traditional cannabis smoking products available. Our customer support representative even confirmed it, remarking how cannabis is moving ‘away from traditional smoke.’ Also notable were the coolers containing a plethora of different cannabis-infused drinks. We half-joked how the dispensary appeared to be more Apple Store than smoke shop, with an abundance of customer support and wealth of kiosks which enabled custom ordering of any product.
CBD popularity will continue to surge
Even before states began to legalize cannabis, the benefits of CBD (the non-psychoactive component in the cannabis plant) were starting to emerge. Gradual legalization has shed more light on CBD and its value as health supplement and non-addictive pain relief option. Panelists were unanimous in agreement that the value of CBD will grow exponentially, underscoring the need for dispensary merchant accounts.
Domestic imports of hemp and CBD
While CBD is classified as a Schedule 1 substance (unfairly), the World Health Organization’s Expert Committee on Drug Dependence (ECDD) recently recommended that pure CBD ‘should not be scheduled within the International Drug Control Conventions.’ Though only a recommendation, the ECDD carries the needed influence. Additionally, the Farm Bill was introduced into the U.S. Senate June 11, 2018, the passing of which would remove hemp from the DEA’s controlled substance list, enabling for a boon to CBD businesses. Exporting CBD will not be far behind.
Federal regulations—be careful what you wish for
For argument’s sake, let’s say the U.S. government legalizes recreational marijuana in 2020 (wishful thinking, we know). The Globalization of Cannabis panel unanimously agreed that federal regulations will be more strict than any state regulations. That means that possession laws in Massachusetts (one ounce or five grams outside of residence; 10 ounces inside residence) could theoretically be lowered to three grams outside and five grams in residence. Cannabis proponents must be prepared for the possibility that federal laws will be more stringent than state laws.
U.S. companies headed north
During our aforementioned retail cannabis visit to a popular Las Vegas-based franchise, our customer support representative told us her employer will be opening two locations north of the border in 2019. They won’t be the only one. Canada has presented a world of opportunity for a variety of American cannabis businesses – growers, merchants and payment service providers eager to offer dispensary merchant accounts and expand their services.
Frankly, Canada could use them – since legalization on Oct. 17, Canadian dispensaries cannot meet consumer demand. As a result, more and more U.S. cannabis companies are expanding north.
Dispensary merchant accounts with Instabill
Instabill has two solutions for dispensary merchant accounts, both of which provide easy checkout, funding and cashless transactions with EFT payouts within 24 hours:
- A debit card solution, similar to a mobile wallet, in which funds are easily loaded for purchases.
- A crypto currency solution in which a crypto ATM and/or POS device are provided, enabling for real-time crypto-to-cash conversion (and cash-to-crypto) and fast checkout.
Have a 10-minute conversation with a live merchant account manager today about opening a dispensary merchant account with Instabill at 1-800-530-2444.