Mastercard to no longer allow marijuana transactions on its debit cards
BALTIMORE -- Mastercard is cracking down on cannabis customers who use their debit cards at dispensaries.
The payment-processing company asked financial institutions this week to stop allowing marijuana transactions on its debit cards.
Medicinal and recreational use of cannabis is now legal in Maryland; however, it remains illegal at the federal level, which prohibits such transactions.
In a statement to WJZ, Mastercard explained:
As we were made aware of this matter, we quickly investigated it. In accordance with our policies, we instructed the financial institutions that offer payments services to cannabis merchants and connects them to Mastercard to terminate the activity. Our rules require our customers to conduct lawful activity where they are licensed to use our brands. The federal government considers cannabis sales illegal, so these purchases are not allowed on our systems.
Those in the cannabis industry say it's going to be up to the federal government to remove the financial restraint around state-legal businesses.
"I don't think it'll be as much of a blow to the day-to-day," Wendy Bronfein with Curio Wellness said. "I think it's more of a statement of why the federal government needs to move and get up to speed."
Bronfein said there are still several ways people can purchase marijuana at dispensaries, including cashless options.
"Cash is always an option, debit cards are still an option, and ACH payments through platforms like Dutchie Pay are an option," Bronfein said. "Debit cards can be used. It really comes down to your bank."
Also, some dispensaries created a workaround for those who want to purchase through a cashless transaction, she said.
"Something called a cashless ATM, which was another pervasive model in dispensaries where the transaction would round up to an equal amount and then you'd be given the difference back as an individual," Bronfein said.
Between July 1 through 23, the government reports $65.7 million in cannabis sales.