Which Dispensaries Take Credit Cards?

By Bruce Boswell •  Updated: 12/14/21 •  6 min read
Filed under: Credit Cards

It broke the world when some States declared Cannabis a legal substance. Until recently it was considered to be a Schedule I drug, but in the past few years, marijuana legalization movements gained enough support to change the way we see things. 

Now, you can find recreational and medicinal marijuana stores (dispensaries) in twenty-nine of the fifty states where you can legally purchase marijuana. 

Which Dispensaries Take Credit Cards

However, the process of doing so is not quite as easy as most of us might like, and while marijuana consumption might be legal in your state, at a federal level it is still banned, and this creates some complications when it comes to making purchases.

You see, federal law trumps state law, which leaves the market unregulated and excluded from financial services. So, if a credit card company lent any amount of money to a cannabis business, they would end up being liable for prosecution. 

Without being able to use credit or debit cards, cash is the main patent form for cannabis dispensaries. However, now, as times change, there are loopholes coming into play and things are slowly changing. You can use a credit card to buy liquor, or at a food truck, so why not cannabis?

So, if you need to get your cannabis, how should you pay, and where should you go to get it?

What Are Dispensaries?

A dispensary is defined as being a place that dispenses medications, medical supplies, and so on. When we talk about dispensaries, we now mostly refer to somewhere that sells cannabis. This is how the term is most commonly used now. 

A marijuana dispensary produces and sells marijuana.

As you can see dispensaries are places focused on medication, and since the discovery of how beneficial marijuana can be for health, it has slowly become more legal, thus making marijuana dispensaries pop up all over the U.S. states where marijuana is legal to sell as a medicine. 

Why Paying Dispensaries With Credit Cards Is Complicated

As we have stated, it is hard to understand why paying dispensaries with credit cards is complicated. Without having a deep understanding of law, it can seem a bit weird.

However, the rules are in place simply because although in your state (i.e. California) it might be legal to buy and sell marijuana, by federal law it is not. So, you won’t get arrested for making the purchase, but using a credit card is out of the question for the most part. 

However, there are things coming into play that will alter this issue for the future, we will discuss what this loophole is later though. To really understand the complexity of the situation, we need to understand the struggles of the marijuana industry. 

It’s An Industry Without Credit

The biggest issue that the marijuana industry faces right now, aside from the struggle to continue to gain legalization in all 50 states, is that it is an industry without credit.

Credit card companies have detached themselves from the marijuana industry to avoid prosecution, and who can blame them, they may themselves support the industry but as a business they cannot.

No credit card company has a merchant code that recreational or medical dispensaries can actually use. 

As a result, the cannabis industry faced yet another hurdle when the Cole Memorandums were rescinded.

This gave medical cannabis dispensaries protection from lawsuits, however, in 2018 the then Attorney General Jeff Session replaced the Cole Memos which left the cannabis market without any protection from financial lawsuits, therefore making things even harder for them.

This means that not only is the financial way of things difficult for those trying to buy from cannabis dispensaries, but it is also hard for the dispensaries themselves, for if they go into debt they have no protection against lawsuits! 

Cash Is King! 

In the cannabis industry in the United States, cash is king, and nothing else can win. How can you pay for your cannabis, generally it is cash only.

The many barriers that stand in the way of card payments mean that you only really have three options available to you; cash, ATM’s, or Mobile Payments. 

We can’t lie, mobile payments are so popular now, and most people will pay with Apple, Samsung, or Google Pay a lot of the time anyway, so perhaps this issue with card payments is not as big of an issue as we might make it out to be. 

Okay, so credit cards are still, for the most part, off the table, but this doesn’t mean you cannot use your bank account to pay directly, mobile payments are so easy and so common now that it almost makes the issue with credit cards moot. 

How can you get around it? Well, budgeting. If you budget well enough, you can balance out your finances so that you stay stable and don’t work yourself into any credit card debt while being able to use online mobile payments for your cannabis. 

Now the loophole…

The App That Is Changing Things 

We are innovators these days and in 2020, there was a new innovation known as ‘KindPay’. This is a new app that allows cannabis consumers to purchase cannabis products using their Visa, Mastercard, and even Discover Cards, as well as other bank credit and debit cards! 

How? We hear you ask.

Well, customers download KindPay, and deposit funds into its FDIC-insured platform using their card of choice, then you can use this money to pay for your cannabis purchases Basically, it is a credit card transaction with just one small added step. 

Okay, so this is basically just a form of mobile pay. However, it is less like using Google Pay, PayPal or the likes, and it is actually more like the Starbucks app in how it works. 

Dispensaries are loving it, and if they sign up with KindPay they actually get a fully compliant FDIC-insured bank account at Herring Bank, as well as a merchant app that syncs up with the consumer via a QR code. So purchases are all debited and credited in real time. 

So, it’s more than your standard mobile pay, and all you need to do is check if your local dispensary uses KindPay, and you can use your credit card. 

Bruce BoswellBruce Boswell

Bruce Boswell

Bruce Boswell enjoys researching and writing about all things related to investing and saving money. Whenever he has a chance, Bruce loves travelling all around the world with his wife and trying new foods.