NEW YORK—One company is reporting it plans to help cannabis businesses address their payments problem, especially around the use of cash.
SuperNet said it is planning to issue and process credit cards that will work in cannabis dispensaries. The service is expected to launch in January 2022, and will be accepted at 100 California retail locations.
“It’s a real credit card they’ll get from us,” CEO Michael W.K. Tsang told TechCrunch. “It’s just like any other credit card in your wallet, except instead of a VISA or Mastercard logo, it’s a SuperNet logo. You can spend it anywhere SuperNet is accepted.”
Three advantages of the new offering, according to the company, include, according to TechCrunch:
- Consumers can leave the cash in the ATM and pay using a plastic card or NFC app.
- Retailers can reduce the amount of money on-site, and collect more data about their customers who are no longer cash transactions.
- There is a loyalty program
Cannabis remains illegal under federal law even in states where it has been legalized. The SAFE Act, which would have removed those federal prohibitions, was recently removed from the National Defense Authorization Act.
Better Tracking
“Regulators want to see fewer cash deposits, and they want to see electronic payments,” Tsang said. “The beauty of what we’re offering is that our money — the electronic money — is tracked from the point of purchase. It’s traceable. We know where the money comes from. In cannabis, with cash, you have to spend a lot more effort to trace where the cash came from.”
“The amount of cash used in legal cannabis transactions is staggering, and money laundering is always a concern by regulators. Cash management is often regarded as one of the most expensive parts of operating cannabis businesses. There are countless examples of dispensaries hiring paramilitary security, storing bundles of cash in plastic totes, and hiring staff only to count the stacks of bills,” Tech Crunch noted.