Cannabis merchants seek regulatory clarity, banking solutions
While medical and recreational forms of marijuana are legal in thirty states and the District of Columbia, cannabis merchants face continuing regulatory uncertainties and blatant hostilities from the U.S. Department of Justice. Recent remarks by U.S. Attorney General Jeff Sessions linked cannabis sales with criminal gangs, violence and a national drug crisis, despite growing public support and reported socio-economic benefits of cannabis usage.
A study published March 12, 2018, by Colorado State University-Pueblo's Institute of Cannabis Research, and funded by local and state cannabis taxes, found the Pueblo area netted $35 million in cannabis revenue in 2016. Researchers further noted the region's demographics have remained largely unchanged since the passage of Amendment 64, which legalized marijuana in the state.
"Legal cannabis has not yet had an observable impact on Pueblo's household incomes," researchers wrote. "It is possible that the enduring federal prohibition shrouds the true impact of legal cannabis on Pueblo's household incomes. This is a phenomenon that requires more investigation."
Banking, processing challenges
Risk-averse banks and payment processors classify cannabis merchants as high risk, making it difficult for those merchants to open bank and processing accounts to safely manage funds from their cash-only businesses. A number of third-party service providers are actively working with cannabis industry stakeholders to address these problems.
San Diego, Calif.-based MoneyTrac Technology Inc. (MTRAC) disclosed March 29, 2018, that it plans to launch MTRAC, a new banking solution, eponymously dubbed MTRAC, designed specifically for cannabis merchants. The system will use blockchain technology to track and record cannabis dispensary transactions. Participating merchants can use the solution to process payments for their consumers and remit payments to vendors, employees and business affiliates.