Dispensary Merchant Account

The demand for legal cannabis has never been stronger, and more states are adopting lenient policies toward recreational and medicinal marijuana. There’s even talk on Capitol Hill of finally lifting the federal ban on delta-9 THC. However, you probably don’t feel all that cheery about these developments if you’re processing payments in a dispensary.

After jumping through hoops to get a state-approved dispensary license, cannabusiness owners have to contend with card processing issues. Unfortunately, since the US federal government doesn’t recognize weed as a legal substance, dispensaries are technically illegal in the USA. No matter how pro-cannabis a state’s laws are, that doesn’t change the DEA’s policy toward pot.

Given this controversial legal landscape, the world’s largest card processors have decided to play it super safe. Companies like Visa and Mastercard have a firm ban on all cannabis-related transactions. Since roughly 70 percent of Americans prefer using debit or credit cards versus cash, this causes friction at eCommerce and brick-and-mortar dispensaries.

The best solution to this payment processing problem would be for the US government to legalize and regulate the recreational weed industry. However, dispensaries that are in business today can’t count on DC lawmakers to close this issue anytime soon. It’s essential for any company dealing with cannabis to know the most effective ways to accept payments from their customers.


Ways Weed Dispensaries Can Accept Payments — What Processing Options Work For Legal Cannabis Businesses?

Out of desperation, some dispensaries have resorted to risky strategies to accept credit and debit card transactions. Heck, a few companies deliberately lie about what they’re selling to give their customers the option of using cards.

It’s understandable why many dispensary owners are fed up with their current payment predicament, but lying about your business isn’t the way to go. Chances are weed businesses will get caught at some point, and the consequences will be dire.

While there’s no one “ideal” solution for dispensary payments in today’s environment, there are many strategies businesses could use to give their customers more options.

Cannabis Businesses Can Never Go Wrong With Cash

Cash truly is “king” in the cannabis industry. Of all the payment methods now available, cold hard cash remains the most frictionless way to sell cannabis flowers. No wonder so many dispensaries install ATMs on their premises and offer discounts for cash payments!

Although cash is arguably the easiest way for dispensaries to conduct business, there are obvious drawbacks to being too reliant on this method. There’s a glaring security issue with keeping so many physical dollars on hand. Cash transactions can also make filing taxes a chore, and many of today’s customers aren’t used to using cash in their daily lives. For those operating an eCommerce site, physical cash isn’t a viable option.

Although paper dollars are a great way to pay for cannabis flowers, most dispensaries need alternative payment methods so they aren’t so burdened with bills.

Investigate Apps For ACH Transfers

A few banking apps now allow customers to send either eChecks or ACH transfers directly to business owners. While this works from a compliance standpoint, it’s arguably the most difficult for customers to accept.

Not only do dispensaries have to convince people to sign up for a new app, but they also have to get their customers to input their banking information. No matter how well-rated an app is, people always hesitate to give out this sensitive data.

While ACH transfers and eChecks are fantastic solutions for dispensary payments, businesses often have to give customers an incentive to sign up. Only you can determine whether it’s worth offering special discounts to enjoy the transactions these apps provide.

Are Cashless ATMs A Legit Strategy?

Cashless ATMs have gained a lot of bad press in the cannabis business over the past few years. The idea behind this strategy is fairly straightforward:

  1. Dispensary owners round up a customer’s purchase to an even number.
  2. A cashier takes the customer’s debit card to “withdraw” said amount.
  3. A budtender returns the difference to the customer.

Since the transactions look like ATM withdrawals, many dispensaries have been able to accept debit cards without drawing the attention of authorities. However, everyone knows about cashless ATMs now, and card issuers like Visa have come out hard against this practice.

It’s hard to say whether cashless ATMs are “illegal,” but regulators aren’t fans of this practice. Although many dispensaries continue to use this strategy, they should be aware they are taking a significant risk.

Consider Becoming a Bitcoiner — Accepting Crypto for Cannabis

image of crypto for cannabis

If you’re in the camp that believes “cash is trash,” you may want to consider going gung-ho for crypto! While Bitcoin has yet to reach mass adoption, it has become more commonplace in today’s society. Cannabis businesses have been big supporters of cryptocurrencies due to their reliance on code rather than central authorities.

Although Bitcoin ATMs are becoming more fashionable at dispensaries, crypto presents many complications to business owners. The most glaring disadvantage is that these digital tokens are incredibly volatile. There’s also a huge learning curve in storing, transferring, and swapping tokens. Plus, don’t forget about all of those transaction and taxation fees!

Lastly, most customers probably won’t be too familiar with buying or exchanging crypto. Granted, it’s getting easier to find user-friendly crypto wallets. Cannabis customers also tend to know a bit more about Bitcoin since it’s so prevalent in dispensaries. Still, dispensaries can’t rely on everyone being familiar with all aspects of crypto trading.

Each dispensary owner will have to assess whether adding a crypto payment option will significantly drive traffic to their business. If so, they might want to look into creating a crypto payment portal.

Search For A Professional High-Risk Merchant Account Provider

To be honest, talking with a high-risk processing company should be the first step dispensaries take to address their payment issues. Although all cannabis businesses face the same challenges with card processing, each company will have unique preferences and considerations.

High-risk merchant providers help provide actionable solutions given a dispensary’s unique needs. Taking the time to consult with a high-risk firm that has experience with dispensary payment processing should help businesses better understand their options and develop a clear business strategy.

Wait, Could CBD Hemp Businesses Accept Credit Cards?

Hemp often gets lumped into conversations about cannabis, but it’s not the same substance. OK, technically, hemp is a cannabis cultivar. However, legally speaking, hemp isn’t a federally-banned drug. Hemp-derived goods with ≤ 0.3 percent delta-9 THC are legal in the USA under the 2018 US Farm Bill.

Does this mean it’s legal for hemp CBD shops to accept cards? Let’s put it this way: It’s easier for CBD stores to take standard credit card transactions versus marijuana dispensaries.

There are many horror stories in the hemp market where card processors, banks, or fintech apps suddenly shut down. However, there are usually more ways hemp companies can legally accept payment options.

Please always speak with a high-risk merchant expert like Shark Processing to determine how your hemp CBD business can legally accept payments.


Got Questions About Dispensary Payment Strategies? — See What Shark Processing Has To Say!

Paying for goods in a legal dispensary isn’t as simple as swiping a plastic card. Even today,

marijuana businesses are scheming new “quasi-legal” ways to let customers pay with credit and debit cards without risking their reputation.

While federal cannabis legality may change before we know it, dispensary owners need to work with the payment options at their disposal. The best way to develop a winning payment strategy is to speak with a high-risk merchant provider that works in the cannabis industry. Shark Processing has helped many people dealing with products like CBD and delta-8 install fantastic payment solutions.

Please consider reaching out to Shark Processing on this link if you’re still unsure how to accept payments at your dispensary.

image of dispensary payment strategies with shark processing


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