Colorado-based payment processor MJ Merchant Solutions has announced the launch of card and mobile payment processing services specifically for recreational and medical marijuana dispensaries.
The trade in the drug has traditionally been cash-based, even with changes to state law in Colorado that legalised its purchase for both recreational and medical uses.
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MJ Merchant Solutions director of marketing Kenneth Cade said: "Last year alone medical marijuana dispensaries did more than $2bn in cash transactions at more than 2,100 individual locations, and these numbers do not even factor in the recreational marijuana dispensaries that began selling marijuana in Colorado in January 2014.
"This makes the marijuana dispensaries one of the most untapped segments for credit and debit card processing companies in the United States. With the addition of recreational dispensaries, the industry is projected to top $50bn in the next 6 years."
The legalisation of cannabis in Colorado caused controversy amongst card networks when it was implemented at the beginning of this year.
At the time, Visa said it would not seek to challenge the state law and would leave the decision on the legality or illegality of marijuana purchases to its merchants.
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By GlobalDataMasterCard said that marijuana purchases were still considered illegal under federal law and American Express took a tough stance, blocking transactions from a payment provider that advertised its ability to set marijuana merchants up with credit and debit card acceptance.
Square also said it would not process payments at Colorado’s marijuana dispensaries.
Kenneth Cade added: "Credit card payment processing is in many ways the best option for both the consumer and the merchant.
"Credit card processing will reduce the number of cash transactions, saving dispensaries in labor costs, reducing the risk of theft and loss, as well as automating, expediting, and making the check-out process more convenient for the consumer."
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