With the legalization of cannabis, high-risk businesses are gaining momentum across the U.S., the industry is becoming a prosperous addition to the retail space. In fact, it is predicted to grow to $30 billion by 2025, and that growth has seen retailers rushing to take advantage of this boom, opening eCommerce and brick-and-mortar dispensaries where cannabis is legal on the state level.
However, as with any relatively new industry, the cannabis space has its share of challenges to overcome. Specifically, such businesses are still figuring out how to operate financially while remaining in compliance with multiple levels of government. Because cannabis is still a Schedule I-controlled substance at the federal level, there are numerous regulations in place wherever it is legal to sell this substance.
Traditional banks are not yet equipped to handle the federal and state regulations surrounding cannabis, making it difficult for high-risk companies to obtain small business loans or process transactions through these institutions.
That is also why cannabis is not currently eligible for purchase using credit cards. Although many Americans use this method of payment for its convenience, the fact that cannabis is still illegal at the federal level prevents credit card companies from accepting payments for this substance — even in places where it is legal at the state level.
Although taking this payment method off the table can be inconvenient for some, there are several other ways high-risk companies can effectively process payments. This guide will delve into each one so that your business can better understand its options.