Now that marijuana is legal in small amounts in Washington and Colorado, officials in those state are having a heckuva time figuring out how to regulate those businesses and collect taxes on their daily doings. But even with the approval of state governments, there’s still the tricky question of how these establishments will be able to do their business — in other words, will customers be able to pay with cash, check or credit?
The ease and convenience of pulling out your plastic to make a purchase makes it a popular way to pay, but because marijuana is illegal under our country’s Controlled Substances Act, for now it’s likely going to be a cash-only business for growers and sellers, notes CNNMoney. Basically, banks don’t want be accused of money laundering, so they won’t take on businesses connected with drugs even if they’re legal in a certain state.
That puts such businesses into a cash-only position, which can be tough on both the owners and the customers. One Seattle store’s CEO said American Express and Discover dropped him last fall, and Visa and Mastercard bowed out soon after. He had to buy his own ATM and fill it with his own cash, then deposit the rest at his bank. The whole thing makes him a bit squirrelly.
“The more cash you have sitting around, the more of a target you are,” he said.
Instead, he created an unrelated holding company, a practice common in the legal marijuana industry. Dispensaries, growers and even those only remotely related to the pot industry, like one security company that offers services to such establishments, say that the restrictions of doing cash-only business “almost makes it impossible to run a proper and legitimate business.”
And if businesses can only deal in paper money, states like Washington are going to have a hard time trying to track weed transactions and in turn, properly tax those pot establishments.
In the meantime, customers visiting marijuana businesses will likely face sights like the atmosphere at one dispensary, which, coincidentally, used to be a bank — reinforced concrete walls, motion detectors and cameras everywhere. Sounds inviting.