 Despite being medically legal in more than 37 states and legal for adult recreational use in more than 18, cannabis remains an illegal substance at the federal level in the U.S.
Because of this, financial institutions such as banks and credit cards won’t work with the cannabis industry due to fear of federal penalties. However, despite this, it's estimated that more than one-quarter of all U.S. cannabis retail sales are disguised by debit card purchases are known as "Cashless ATMs." They show up on your bank statement as an ATM withdrawal or purchase to a completely unrelated, non-cannabis business to intentionally hid these transactions from banks that must prohibit them under federal law. While these cashless ATM purchases may sound convenient, they also can have serious repercussions. A few years ago, the then-CEO of cannabis delivery platform Eaze pleaded guilty to bank fraud for processing more than $100 million worth of credit and debit payments for cannabis transactions. There are some alternatives a few creative groups have come up with, but until the government gives us new cannabis legislation, it’s up to you to make sure you’re staying compliant, as businesses, and as customers. Comments are closed.
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