This whole cannabis banking and credit thing is ruining our buzz like a pocket of seeds right in the middle of a fresh nugget. With weed still illegal at the federal level, most banks and credit card companies are stilly weary of doing any business with the marijuana sector.
As a result, cannabis has stayed a largely cash business. This, as a commission from the California state government reported last year, has made “cannabis businesses, their employees, and their customers targets of violent crime.”
That’s why one interstate chain of dispensaries has found a potential solution in offering its own credit cards.
Columbia Care has franchises in twelve states, the District of Columbia, and Puerto Rico. They’ve created a system where customers can fill out a quick application on a tablet and, frequently, get a credit card which they can use in the location that same day.
According to Columbia Care’s CEO Nicholas VIta, the new credit system has some advantages.
“We have an industry where people have to use their debit cards or ATMs or cash to make purchases. It’s like 1974,” Vita told the Chicago Tribune.
“If you go to an ATM, you can only take out so much money,” he said. “If you go in and have the cash in your wallet, you can’t do much more than that.” Of course, most ATM’s let you take out at least several hundred dollars, so we’re not sure how big of a limitation that is on customers.
The credit card also has a downside, at least if you consider an extra 16% tax on your cannabis purchases a downside. In Illinois, the card does not come with any fees, but it does carry 15.99% annual percentage on purchases.
Some customers must love it, because Vita says customers who use a store credit card buy 18% more per visit than those who pay with cash the 1974 way.
Photo via Flickr user Dank Depot