Cannabis Payment Processing You Need To Know
Cannabis as the world knows it refers to the group of plants that have psychoactive features known as cannabis Sativa, cannabis Indica also cannabis ruderalis. The flowers of these plants are processed by harvesting and drying.
After processing Cannabis, what you are left with is the most commonly used drug in the world. Some people call it a weed, pot, and marijuana. Though Cannabis is illegal in many places, legalization and recreation in some parts have given scope for the cannabis business for medicinal purposes.
What Is Cannabis Payment Processing?
The subject of cannabis payment processing solutions becomes a matter of frustration and exasperation many times. Legal cannabis merchants working in licensed dispensaries in European countries mostly accept only cash.
This leads to a lot of disruption and corruption. However, some merchants do offer card payment methods that are funded with cash. This is similar to debit. Or the other best practice is cannabis payment processing with cryptocurrency. The advantage is that through both the payment methods, merchants receive electronic funds within 24 hours.
A digital wallet or debit card fund transfer scheme ensures monetary safety and work out even for hemp and CBD oil product payments. If you closely look into the cannabis payment processing transactions, this is how it happens:
- Customers/merchants/patients connect their cards with digital wallets.
- A fund transfer/transaction is made with the necessary amount into the merchant wallets.
- Customers/merchants/patients make a legal purchase through a licensed dispensary.
- The merchant receives electronic funds within 24 hours for the products.
Cannabis Payment Processing Through Crypto Currency:
Cryptocurrency is considered to be the safest method of payment where the legal matters kick in, especially in the European market where 78% of the merchant businesses relating to variant products are carried out in cryptocurrency.
Most European countries like Austria, Czech Republic, and the Netherlands and many more benefit from such a payment method immensely. As credit card payments for cannabis payment processing are next to impossible, cannabis merchants turn to cryptocurrency payment methods.
With the recent collaboration with many payment gateway platforms, merchants can furnish cannabis payment processing with POS countertop devices and a separate cryptocurrency ATM. These platforms have the following features:
- Conversion of cash into cryptocurrency and vice-versa.
- Real-time withdrawals for an easy point of sale payment.
- Biometric security like fingerprint and face scanning.
- Software integration with automatic teller machines.
- Devices that intelligently recognize cryptocurrency forms which include bitcoin, Ethereum, and digital wallets like blockchain apps.
How Does Cannabis Payment Processing Through Cryptocurrency Work?
This is how cannabis payment processing through cryptocurrency works to ensure utmost safety and transparency in payments.
- Consumers need to scan a QR code of their digital wallet on the screen of the point of sale or through an ATM device.
- The value of the digitally entered currency is calculated in real-time.
- A consumer receives the correct amount of cash or cryptocurrency to pay for transactions.
- The customer receives the confirmation invoice receipt as proof of the transaction is complete.
- The merchant gets funds with 24 hours in their wallets.
This entire process of cannabis payment processing through cryptocurrency eradicates the need for immediate cash transactions and payments are directly released in digital wallets.
What Are the Hurdles Faced During Cannabis Payment Processing?
Many progressive European countries, including Romania, Spain, Poland, and more have legalized recreational Cannabis in different forms, growth. However, its use and regressive sale remain illegal under federal laws to some extent.
This forms the most significant hurdle or obstruction for cannabis merchants and the related banks and payment processors. The marked cards that bridge the gap of payments are Mastercard, Visa, Amex, and discover. Moreover, Cannabis remains a schedule 1 drug along with heroin, ecstasy, LSD, and peyote.
Most of the banks are supported by the Federal Reserve, and they refuse to offer cannabis payment processing solutions for medicinal or recreational purposes. Few of them are open to providing their services. Even some of the most prominent digital wallet names in the world supporting international transactions do not allow the initiation of payments for Cannabis.
This is the second most significant hurdle for cannabis merchants, who are in desperate need of a more straightforward payment solution with safety and security.
Cannabis dispensaries which have a legal system for the same rely primarily on cash transactions. These dispensaries merchants are made to make large cash deposits every day. This possesses an excellent problem for cannabis payment processing due to the lack of digital wallets. A solution to this is the most awaited and matter of concern for merchants. Now apply for the best CBD friendly payment processors with Quadrapay.