Many states are ready to legalize medical and recreational cannabis in 2021. This trend has fueled the increased sale and encouraged many newcomers to venture into this lucrative and fast-paced industry. The cannabis market is projected to boom to $30 billion by 2025.
Unfortunately, there is a significant challenge for cannabis businesses to accept card payments since U.S. banks cannot offer banking services to this industry because the banks have to follow the strict guidelines from the Federal Government in payment processing.
Indeed, banks and payment processors cannot provide any credit payment because of the unfortunate fact that the federal-level illegality of dispensaries prevents them from participating with any cannabis businesses.
This inability prevents cannabis companies from growing rapidly, thus earning more revenue opportunities. Besides, the banks continue to deny secure bankcard opportunities for expanding operations as they would be considered in violation of Federal laws.
How Stablecoins Could Help Your Cannabis Accept Credit Card?
Since there is no access to direct banking services, cannabis companies cannot accept card standard payments. Therefore, the cannabis business owners have to hold too much cash, which poses some problems such as theft. This issue is an opportunity for alternative payment solutions to provide stablecoin (USDC) or blockchain platforms to accept payments.
USDC, the stablecoins backed by many global fintech firms, Circle, and recently MasterCard, runs on Stellar, Algorand, Ethereum, and Solana Blockchains and is managed by a consortium comprised of Coinbase and Bitcoin mining Bitman.
The best thing about stablecoins is that every coin is backed by the U.S dollar, which means they can fix the volatile issues from the non-stablecoin such as USDT. Besides, the deal with MasterCard recently helps customers and businesses easily use stablecoins for high trust, low friction transactions.
The stablecoins also allow the cannabis retailers to get merchant bank accounts since they are an ideal medium for closed-loop payment solutions.
Why Stablecoins Are the Ideal Solution for Cannabis Payment?
Using cryptocurrency as a payment solution in your cannabis is a win-win effort. Now, crypto is more reliable, easy to use, and seemingly secure.
First, cryptocurrency can lower the transaction fees for cannabis. Although some cannabis shops can use credit card processing, the transaction fee is very high as cannabis is considered high-risk. However, the transaction fees using crypto are usually around 6.5%, making for a better alternative.
Furthermore, if you are a small business and have to collect the tax by yourself manually, stablecoins has an automatic system to streamline tax collections. This benefit can save you the time and energy that you can spend to develop your business.
Finally, cryptocurrency payments make the compliance simpler as it provides all required information by the transaction. Therefore, merchants can keep their businesses safe and secure.
How International Payments Processing Help Your Cannabis Accept Credit Cards
At IPP, we work hard to understand your payment processing needs and provide the best payment solutions for your cannabis business to grow and succeed. We help your dispensary accept credit and debit cards with our payment technologies and partners, providing retail payments solutions for in-store purchases, thus limiting your cash on hand and preventing theft.
Our technology also keeps you up to date with the inventory, providing a better decision and increasing sales by offering digital payments.
Finally, our customer service is the best. Our 24/7 365 support team is always ready to answer any questions from your consumers, and, therefore, your consumers can have the best experience with your store.
Contact us today to receive a free cost analysis to assess your processing needs and determine the best solution for your cannabis store.