Being a Cannabis dispensary, producer, edible manufacturer, or accessory-related business has its drawbacks. Mainly, that legalization in Canada is new and it is a state-to-state hodgepodge in the United States. This has created drawbacks and inconsistencies in how Cannabis companies can accept payments through debit and credit card sales. Cash sales are used in many storefronts despite full legalization in Canada and in states like Massachusetts where it is fully legal. This is not ideal for business owners.
Cannabis Cash Transactions are Outdated and Limiting
Cannabis Credit Card Processing Services
Cash may seem simple enough, but it poses many risks to dispensaries and other marijuana retailers. For example:
- Cash must be physically deposited at a bank, which means risk from traveling to the bank from the storefront. There are horror stories of business owners being followed to and from the bank even robbed at gunpoint.
- Cash is dirty as it has been handled by countless individuals. In the time of Covid-19, this is not helpful to business owners or customers.
- Cash isn’t something all people carry a lot of these days. With debit and credit cards used for even the smallest of transactions, cash is less common than it used to be.
- Cash isn’t scalable. If a customer wants to purchase $200 worth of cannabis but they only have $125 on them, that is $75 in revenue lost to the business where the customer could buy what they wanted if the business offered card sales.
- Other miscellaneous problems
Working with Cannabis Friendly Banks is Difficult
It isn’t all bad news for the Cannabis industry. Because there is national legalization in Canada, it is slowly getting better for retailers on the payment and merchant services front. In the USA, it is getting there, but only in states where Cannabis is legalized both medically and recreationally.
Right now large national banks, like Chase or Bank of America, are still unwilling to offer credit and debit card processing services to marijuana and CBD businesses. This is despite them offering the same services to gun dealers, escort services, strip clubs, pornography businesses, gambling companies, and more. You get the idea.
Despite legalization, these large banks aren’t willing to budge on Cannabis because of the lack of federal legalization in the USA. You would think that in Canada it would be a different story because of the federal legalization of Cannabis products. But that is not the case!
Working with Canadian banks requires a lot of relationship building and stress. Only localized regional banks are even willing to take a look at your business if it’s in the space. But even then not all local banks are willing to offer Cannabis businesses the time of day. Or if they do it is with the “high-risk” demarcation. This means huge processing fees of up to 10% and huge cash reserves where you must let the bank hold money in case of chargebacks or fraud by customers. This should not be the case!
Why Brother Processing is Different
We have been investors in the Cannabis industry since before full legalization in Canada. We’ve also worked with countless CBD and Cannabis dispensaries in the USA. Our relationship with partner local banks isn’t something that happened overnight. We’ve been working within the industry for years and the relationships we have with a handful of Cannabis friendly banks are something we pride ourselves on. It is also the reason so many retailers (both online and offline) are working with us.
Businesses within the Marijuana and Cannabidiol space have taken note. We’re one of the fastest-growing Cannabis Credit Card Processing Services in Canada or the United States. Give us a call today and let’s discuss your specific processing needs.
