Columbia Care, a medical marijuana company, has rolled out its own credit card as the cannabis industry struggles to find alternatives to having to deal in cash only.
Just like banks, credit card providers have been reluctant to embrace the marijuana industry because of fears that they would be sanctioned by the federal government since marijuana remains an illegal substance federally.
This has compelled most dispensaries to accept only cash, with ATMs being a frequent sight on the premises of dispensaries. Some dispensaries have designed systems which accept ATM or debit cards for making payments for purchases made.
Columbia Care has been running trials of its credit card in New York and it now plans to roll out this system in Chicago where it has a dispensary within the Jefferson Park neighborhood. Nicolas Vita, the company’s CEO says that patients spend approximately $144 each time they visit the dispensary in Chicago.
He added that the introduction of the credit cards will make it easier for patients to access the medical marijuana products that they need. He singled out patients who have mobility challenges and those who travel long distances to find a dispensary as some of the patients who may buy more products once they have the credit card. Buying more during a single visit reduces the frequency of making trips to purchase replenishments.
To get the credit card, patrons will be asked to use the tablet in the dispensary to fill a form. The credit card will then be processed quickly and the dispensary client will be in position to use that card during that same visit.
Columbia Care revealed that it is working hard to secure intermediaries and financial institutions in all the 12 states where the company has operations. Those partnerships will make it possible for dispensary clients to use the credit card in those other states.
Unlike other credit cards, the one issued by Columbia Care will not attract any fees. Its annual interest rate (15.99 percent) is also lower than the industry average (17.73 percent).
When the credit card was tested in New York, customers bought approximately 18 percent more products when using the credit card when compared to the purchases made when paying cash or using an ATM or debit card.
Other attempts have been made to find alternative ways to receive payments, but some of those methods border on illegality. For example, some companies accept credit cards but the purchases are reflected on credit card statements as spending at a florist’s while other companies ask clients to buy a gift card and then use that gift card to buy marijuana products.
Meanwhile, there has been a recent push by different groups, such as Attorneys General and banking associations, urging Congress to enact legislation bringing marijuana industry money into the banking system.
It would be interesting to know what industry players like Sugarmade Inc. (OTCQB: SGMD) and Sproutly Canada Inc. (CSE: SPR) (OTCQB: SRUTF) (FRA: 38G) think about some of the unorthodox payment methods that some marijuana companies have resorted to.
CNW420 spotlights the latest developments in the rapidly evolving cannabis industry through the release of two informative articles each business day. Our concise, informative content serves as a gateway for investors interested in the legalized cannabis sector and provides updates on how regulatory developments may impact financial markets. Articles are released each business day at 4:20 a.m. and 4:20 p.m. Eastern – our tribute to the time synonymous with cannabis culture. If marijuana and the burgeoning industry surrounding it are on your radar, CNW420 is for you! Check back daily to stay up-to-date on the latest milestones in the fast -changing world of cannabis.
To receive instant SMS alerts, text CANNABIS to 21000
For more information please visit https://www.CNW420.com
Do you have a questions or are you interested in working with CNW420? Ask our Editor