In a pivotal move, financial giant Mastercard has taken a stand by barring US customers from using its debit cards to purchase legal marijuana from shops. This decision comes as a response to the ongoing federal ban on marijuana, which has forced customers in 38 states where its use is permitted to rely primarily on cash for their transactions.
Mastercard’s action was prompted by its discovery that some cannabis shops were accepting debit payments despite the federal prohibition. In adherence to its policies, the company swiftly initiated an investigation and directed the financial institutions facilitating payment services for cannabis merchants to discontinue such activity.
The heart of the matter lies in the federal government’s stance, which deems cannabis sales as illegal. In light of this, Mastercard has reiterated its position by clarifying that these purchases are not permissible within their systems.
For customers in the 38 states where medical or recreational marijuana is legal, the inability to use debit cards at dispensaries has been an inconvenience. While medical marijuana is allowed in these states, recreational use is permitted in 23 states, including the entire US West Coast and Washington DC. However, the cash-only nature of these transactions has presented challenges for businesses and customers alike.
Canada, on the other hand, embraced a national legalization of cannabis in 2018, offering a contrasting approach. There, customers are typically allowed to use credit or debit cards for cannabis-related purchases, creating a smoother experience for both consumers and merchants.
Not everyone is pleased with Mastercard’s decision, and it has garnered criticism from Brady Cobb, CEO of Sunburn Cannabis. Cobb expressed concern that this move would adversely affect the burgeoning cannabis industry and its customers, who desire easier access to this legal product.
As the US Senate, controlled by Democrats, aims to pass a law facilitating better interaction between cannabis businesses and financial institutions, there remains a sense of skepticism from some, such as top Republican Senator John Cornyn. He described the likelihood of the bill’s passage as “wishful thinking.”
The current landscape surrounding legal marijuana sales in the US remains complex and multifaceted. With Mastercard’s recent move and the ongoing push for more accommodating legislation, the future of financial transactions within the legal cannabis industry remains uncertain. As advocates continue to call for change, the nation navigates the intricate maze of federal regulations and state-level legalization, seeking a harmonious balance between legality and financial accessibility for both businesses and consumers.
