The United States Mastercard service for using debit cards to purchase legal marijuana may be terminated due to the remittance processing company’s request that the nation’s payment processors stop processing such transactions.
The decision, first reported by Bloomberg, is a setback for the cannabis business, which already operates outside the US financial system due to the drug’s official prohibition.
Although cannabis is legal for medicinal and recreational use in 38 states, dispensaries only accept cash. However, Mastercard has reported that some stores still accept debit card payments despite government restrictions.
“We started an investigation as soon as we learned about this situation. According to our standards, we told the financial institutions that connect cannabis merchants to Mastercard and provide payment services to them to stop the activity, a company representative said on Wednesday.
The statement said, “These purchases are prohibited on our systems since the federal government considers cannabis sales unlawful.
Brady Cobb, CEO of Sunburn Cannabis, blasted Mastercard’s action, saying it was “another blow to the state-legal cannabis industry and patients/consumers who want to access this emerging category.”
Reforms to facilitate the selling of legal cannabis have been demanded by marijuana proponents.
“We will continue to advocate for cannabis reforms in Washington through further dialogue with elected officials and stakeholders to advance conversations supporting the growth of safe, legal cannabis across the US,” said Darren Weiss, president of the marijuana company Verano, according to Reuters.
Republican Senator John Cornyn earlier this month also referred to Majority Leader Chuck Schumer’s proposal to enact a marijuana banking bill as “wishful thinking.”
The SAFE Banking Act, a piece of legislation, is essential for facilitating the cannabis industry’s access to banking services. Source