Mastercard Bans Cannabis Debit Card Purchases
Mastercard has banned cannabis debit card purchases which has shaken up the cannabis industry.
Mastercard has notified financial institutions that they have banned cannabis purchases on their debit cards (1). This has dealt a blow to the United States (US) cannabis industry which has been suffering due to cannabis’s Schedule I ruling and federal illegalization. With no support from the US federal government, the cannabis industry is beginning to suffer, and businesses are unable to pay their bills. The Secure and Fair Enforcement (SAFE) Banking Act was the prayer answered to cannabis businesses but unfortunately it hasn’t garnered enough support to pass and keeps hitting opposition from the Republican party (2). A group of state cannabis associations are urging Senate leaders to pass a bipartisan banking bill for the cannabis industry due to the struggles it is facing.
In the US, most banks do not provide services for cannabis companies due to the plants’ illegalization. Unfortunately, it doesn’t get better businesses in states that have passed legalization measures for recreational or medicinal use.
“As we were made aware of this matter, we quickly investigated it. In accordance with our policies, we instructed the financial institutions that offer payment services to cannabis merchants and connects them to Mastercard to terminate the activity,” a spokesperson for the company said on Wednesday (1). “The federal government considers cannabis sales illegal, so these purchases are not allowed on our systems,” the spokesperson added.
In a statement (1), Sunburn Cannabis CEO, Brady Cobb, stated how, “this move is another blow to the state-legal cannabis industry and patients/consumers who want to access this budding category.”
Mastercard’s ban on cannabis transactions still inspires and riles companies up to continue advocating and not to give up on what can help the cannabis industry. Pot firm Verano's President, Darren Weiss, mentioned (1), “We will continue to advocate for cannabis reform in Washington through further dialogue with elected officials and stakeholders to advance conversations supporting the growth of safe, legal cannabis across the U.S.”
Earlier in July 2023, Republican Senator John Cornyn commented how Majority Leader Chuck Schumer’s plan to pass a cannabis banking bill was “wishful thinking”.
In a time where credit institutions are negatively impacting the cannabis industry with their bans on cannabis purchases, it shows how crucial the SAFE Banking Act is needed to save the industry from losing their businesses and fear of federal crackdown for both banks and businesses (1,3).
References
- Nishant, N.; Dhumal, T. Mastercard Moves to Ban Cannabis Purchases on its Debit Cards https://finance.yahoo.com/news/mastercard-demands-termination-cannabis-purchases-174141843.html (accessed Jul 28, 2023).
- Jaeger, K. State Marijuana Associations Rally to Urge Marijuana Banking Vote “Without Further Delay” https://www.marijuanamoment.net/state-marijuana-associations-rally-to-urge-marijuana-banking-vote-without-further-delay/ (accessed Jul 28, 2023).
- Casacchia, C. Mastercard Ban on Cannabis Debit-card Purchases Rocks Industry https://mjbizdaily.com/mastercard-ban-on-cannabis-debit-card-purchases-rocks-industry/ (accessed Jul 28, 2023).
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