At Dual Payments, we understand that choosing a reliable payment method is an important part of running a cannabis dispensary. Marijuana credit card processing presents unique challenges because cannabis businesses can face restrictions from financial institutions, even where medical or recreational sales are permitted under state law.
This can create issues for dispensary owners to accept easy to pay methods, track day-to-day payments and have a smooth business process. It is important for business owners to know what are the pros and cons of each payment method.
Each payment type (cash, crypto, debit card hacks and specific card processing) will give your business a different experience. We help you to consider what payment method will be best for your business by providing information on how easy they are to pay with, secure, cost and any regulations.
With the correct information, dispensary owners can make more informed decisions when it comes to accepting payments and provide a smooth purchasing experience for customers.
Why Cash Can Create Operational Problems
Cash is often a large part of the cannabis industry. This can create extra challenges for dispensary owners. From storing cash, to using employees to handle cash, to depositing and transporting it to banks, there can be quite a few processes involved.
We note that using armored transport and security can create additional costs for businesses. These can be a distraction from running your business as you will need to focus on other areas such as providing customer service, managing stock and coordinating employees.
Cash can also cause issues when trying to pay regular business costs such as rent, pay and tax if you are unable to get the right banking set up. While cash can be an option to pay with, you should consider how much it will impact on your business.
Having a sensible payment strategy in place can help dispensary owners to consider security, reduce handling and make the overall process easier.
Cryptocurrency Payments and Their Limitations
Cryptocurrency can be a great option for cannabis businesses to allow digital payments. Although it can reduce the need for using cash, there are factors to consider.
We noted that limited merchant options and not having accessible payment options for the customer can be an issue.
If you are a dispensary, we would encourage you to think about how your customer will actually pay for the products. The payment method should be practical for your business and easy to understand.
Before implementing cryptocurrency payments, owners should consider what legal requirements apply, how the money will be settled, exposure to volatility and how it will affect your accounts. Digital options can be a good option to consider; however, they need to be suitable for your dispensary, customers and finances.
Debit Card Workarounds and Cashless ATMs
Some dispensaries have implemented cashless ATMs. The Dual Payments system detailed in the article allows customers to pay for store specific vouchers using their debit card.
Vouchers are issued in $5 denominations and are only valid in the store they were issued. This can reduce the handling of cash however there may be additional costs involved in setting up this system and transaction costs for customers.
Review the full costs involved in this system before choosing to implement. Dispensary owners should also ensure the transaction method is allowed by your processor, financial institution, card network and laws.
Never assume a work around payment method is allowed. By reviewing these details businesses can see how convenient the method is versus the costs and complexity involved.
Evaluating Specialized Merchant Accounts
Cannabis dispensary businesses may struggle with the standard merchant account application process. Specialist payment providers will be able to provide you with payment solutions that cater to your high risk business.
We always advise merchants to look at what the account is actually offering. This includes what cards are accepted, how you will receive payment, what reporting you will receive, will you qualify and how well do they understand the regulations around cannabis.
You should also check what fees there are per month, what transaction fees there are, equipment costs, what deposit requirements are and what could cause your account to become restricted. This can affect how suitable your payment solution is going to be long term. They should be clear on what underwriting criteria they have and what documents they require you to send.
Before you sign any agreements it is important that the provider is clearly stating that they will support your business model, location and sales channels. Taking your time to look at what they can offer will help set realistic expectations and reduce the chances of you choosing the wrong service.
Comparing Fees, Security, and Customer Convenience
When considering payment processing, you need to think about the overall cost of taking payments. Cash will incur handling fees and security costs. If the payment is cashless, the use of an ATM may include setup and transaction fees.
There may also be specific costs involved with using specialist payment processing services. You may want to compare the cost of these to the benefits they provide. Security is also an important factor to consider as the dispensary may be handling sensitive customer information and large amounts of money on a daily basis.
You should consider how you are securing your transactions, where your money is being stored, how you are receiving settlements into your account and what protection is in place if there is an issue with a payment. One benefit of accepting electronic payments is reducing cash handling and making the purchase process easier (Dual Payments).
However, it is important to check any terms, security and costs yourself. This will help you to make informed decisions as an owner of the business.
Preparing Your Dispensary for Payment Processing
Before choosing a processor it is important to know exactly what you need from your payments. Consider your average spend per transaction, how many transactions you complete per day, customer preferences and how many locations you need to accept payments.
Consider what you need from your payments. Do you need to accept payments in store, online, delivery payments or contactless. We offer a variety of payment solutions. This can include major card brands, debit payments, e-commerce and automated clearing houses.
Depending on the service, eligibility and requirements, availability will vary. We would recommend asking potential providers if they can provide you with a written quote, clear settlement times, technical support and information about their compliance processes.
Before investing in any equipment or changing your checkout process ensure the processor can accept your exact business type. By having these questions ready you will be able to compare providers and your team will know what to expect.
Marijuana Credit Card Processing: Choosing a Better Path Forward
Choosing marijuana credit card processing requires dispensary owners to balance customer convenience, operating costs, security, and regulatory obligations. We believe the best method is to understand the pros and cons of current payment methods and identify a provider that supports your business.
Whilst cash can be a useful option, it can also cause issues with handling and security. Cryptocurrency and cashless ATMs can be considered however there will be some practical considerations. There may be additional options available with specialist payment processing.
When choosing a payment provider ensure they are authorised, compliant with current legislation, transparent with their pricing, settlement process and types of transactions they offer. We would recommend cannabis businesses to choose transparent providers.
Dispensaries can create a more efficient checkout system by being well informed about their choice of payment providers. They can also ensure they are being financially responsible and prepare for any changes in the payment industry.
