(Source: www.forbes.com)

Hawaii has decided to turn its medical marijuana program into a cashless payment system in the hopes of avoiding the problems that other states and businesses have faced when dealing large sums of cash. The goal is that by October 1, all of Hawaii’s licensed dispensaries will no longer use cash, but instead ask their customers to pay with a debit payment app.

Governor David Ige said at a press conference on Tuesday, “Cannabis is illegal at the federal level, still a schedule one controlled substance. Because of this, all financial institutions in Hawaii have decided against providing banking services to the dispensaries. This solution allows the dispensaries to be able to write checks, to do all of the normal financial transactions that most businesses would do.” Hawaii legalized medical marijuana in 2000, but only recently implemented its program.

Banking has been tremendously difficult for cannabis companies. The major banks refuse to work with these businesses because marijuana is still federally illegal. The major credit card companies have also turned their backs on customers wanting to use their bank cards to engage in such transactions. This has caused inconvenience for the customers who are forced to pay with cash and the dispensaries that end up with stacks of cash that needs to be processed.

“The arrival of banking and payment services for the cannabis industry in Hawaii will enable dispensaries to reduce or eliminate cash sales, which will help keep these businesses much more secure,” said Kerry Komatsubara, Executive Director of the Hawaiian Educational Association for Therapeutic Healthcare. “The cash-only precedent in this industry is less than ideal for customers, employees, and the general community, so having alternative options available really does change how we do business for the better.”

The debit app called CanPay steps in to provide an alternative to cash-only transactions. It is partnered with Safe Harbor Private Banking, a Denver-based division of partner Colorado Credit Union, which is a leading compliant banking program that specializes in working with cannabis companies.

“Removing cash from the equation leads to a more transparent and legitimate way to do business that’s both convenient and secure for all involved,” said Dustin Eide, CEO of CanPay. “Through the lengthy collaboration between ourselves, Safe Harbor, and the tremendous individuals in Hawaii’s legal cannabis market, these dispensaries are now able to operate as closely as possible to businesses in any other industry.”

While the cash has been a problem for some customers and businesses, there are many who prefer to keep these transactions in cash. Concerns over government intrusion and general privacy have kept these consumers wary of a system that can track all cannabis purchases. Dispensaries will still be able to accept cash transactions, although they will encourage customers to use the cashless system. Patients that don’t have a smart phone to use the CanPay system can set up an account with their email and log into a computer at the dispensary to complete a transaction.

More Info: www.forbes.com

Advertisements