Mastercard has directed US banks to stop allowing cannabis purchases with its debit cards due to the complex legal and financial issues faced by the cannabis industry, despite the increasing legalization of cannabis in many states.
In an official statement, Mastercard explained that since the federal government considers cannabis sales illegal, the company has banned such purchases on its systems. Mastercard promptly informed financial institutions connected to cannabis merchants to cease these activities in accordance with its policies.
Following Mastercard’s action, companies using PIN debit payments for cannabis are now seeking alternative solutions for dispensaries that rely on these services. The move is expected to limit convenient payment options for cannabis consumers, potentially pushing them towards cash-based transactions. Major banks and credit card companies have traditionally restricted cannabis transactions due to the federal illegality of the plant, leaving limited payment options for buyers in states where cannabis is legal.
The impact of Mastercard’s decision underscores the ongoing challenges faced by the cannabis industry in accessing traditional financial services and highlights the need for federal-level reforms to address these constraints.
By FCCT Editorial Team
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