As of 2017, there are 28 total states that have voted to legalize marijuana in some form for medical purposes — and 8 states, plus the District of Columbia, have voted for full legalization.
For cannabis enthusiasts, medical patients, advocates and dispensary owners, the growing groundswell of acceptance at the state level is good news.
But, notes Shaunt Sarkissian, CEO of Cortex MCP and CSP Technologies, it’s kind of good news with an *asterisk,* because while it may be cool to inhale in certain states, marijuana is still classified as a Schedule One narcotic by federal guidelines.
That means when it comes time to pay for it — things get kind of complicated.
“It is an interesting market, especially for traditional payments people like myself,” Sarkissian told Karen Webster in a recent conversation. “I don’t think there is anyone in the industry who hasn’t looked at it to see if it is an opportunity. But the reality is that because it’s a Federal Schedule One, it is banned by all the card networks. So, it’s off the table for anyone working in the merchant services business.”
Because of the state and federal conflict regarding legality, cannabis payments are quintessentially a square peg trying to fit into a round hole. A round hole that, today, is being filled with cash.
But, Sarkissian notes, as more states legalize cannabis for recreational purposes, the market needs to be addressed — which is why it will get a starring role at The Innovation Project this year. States are totally ready to inhale the multi-billion dollar tax opportunity that it presents, and so are the payments networks — but cutting through the regulatory haze (we promise we’re done now) will take some outside the box thinking.
The Cash Crunch