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Cannabis credit card processing is currently illegal in the US, but there are good alternative options for processing marijuana payments, including ACH transfers and PIN debit payments.
WRITTEN & RESEARCHED BY
Expert Contributor
Last updated onUpdated
REVIEWED BY
Lead Staff Writer
Cannabis payment processing can be confusing and challenging, especially for a new dispensary owner.
Marijuana is legal for medicinal purposes in 38 states and for recreational use in 24 states. However, cannabis remains a controlled substance that is illegal under US federal law.
Despite intense demand from consumers to be able to use their credit cards at a dispensary, there is currently no legal, secure method to accept credit cards for cannabis sales in the United States. There are, however, viable alternatives to operating on a cash-only basis, including debit card sales, ACH (bank) transfers, and even crypto payments.
Here, we’ll profile the best providers that work with cannabis businesses. We’ll also discuss the payment methods available to cannabis dispensaries. Finally, we’ll cover the legal issues that make cannabis payments so challenging and give tips to help you find a reputable provider for your business.
Learn More About Our Top Picks
| Company | Highlights | Next StepsHighlights |
|---|---|---|
Instabill
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PayKings
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Seamless Chex
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Clearly Payments
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Read more below to learn why we chose these options.
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Table of Contents
A cannabis payment processing account is simply an account that allows you to accept noncash payments for cannabis products. It’s important to know that these so-called “high-risk accounts” almost always come with higher fees and more restrictive policies than traditional low-risk merchant accounts.
Most of these processors offer alternative payment options for cannabis sales such as ACH, while others offer a cannabis POS system for debit card payments (and credit card payments in other countries that allow it).
| PIN Debit | ACH Transfer | Cryptocurrency | Accepts Cannabis Merchants | |
|---|---|---|---|---|
| Instabill | In US, Canada, Intn'l | |||
| PayKings | In US, Canada, Intn'l | |||
| Seamless Chex | In US Only | |||
| Clearly Payments | In Canada Only |
Pros
Cons
Instabill is a veteran high-risk provider that offers payment processing services to recreational and medical marijuana dispensaries, with international and multicurrency support.
Instabill clearly discloses who it works with, what payment methods are available, and what limitations you'll have to accept. We're particularly impressed with the disclosures regarding the need for a rolling reserve account -- something most providers won't tell you about.
Getting approved for a cannabis merchant processing account with Instabill will require four to six months of previous processing history, which could be a real challenge in this industry. Account approval requires anywhere from 10 business days to two weeks.
Pros
Cons
PayKings is a high-risk payment gateway that supports in-person and online credit card processing in the US, Canada, and in other countries as well. Most importantly, they offer payment processing options to US cannabis dispensaries, as well support for eCommerce businesses that sell cannabis products online.
PayKings touts its Shopify integration, specifically for the sale of CBD items. CBD e-sales are allowed in all 50 states as long as the THC content by weight is less than 0.3%. As cannabis retailers know, you can pack some pretty potent edibles into a full-spectrum CBD-THC gummy---a gummy with 10 or 12mg of THC will get your customers quite buzzed while still falling well below the 0.3% THC threshold.
Pros
Cons
Seamless Chex offers various merchant services, specializing in eCheck and ACH (Automated Clearing House) payment processing for high-risk businesses, including cannabis dispensaries. Dispensaries can also use Seamless Chex debit card processing to take payment for in-person retail transactions.
Some great things about Seamless Chex for dispensaries include month-to-month billing, with no long-term contracts or early termination fees. Seamless Chex also offers same-day account setup, and you can sign up right from their website.
Get Started With Seamless Chex
Pros
Cons
Clearly is a reputable, transparent payment processor that serves low- and high-risk industries, including cannabis dispensaries. A Canadian company, Clearly also accepts US-based merchants, but unfortunately, it only offers cannabis payment processing for dispensaries in Canada, where marijuana is legal and businesses can accept credit card payments for cannabis sales, not just debit.
Some things to like about Clearly include its month-to-month contracts, Clover POS hardware, and interchange-plus and membership pricing options, which are ideal for higher-volume dispensaries.
Get Started With Clearly Payments
Merchant Maverick has been researching the payment processing industry since 2009. Our writers have reviewed hundreds of credit card processors, merchant account services, and mobile payment apps, evaluating each provider carefully on several different metrics.
When comparing different payment processing companies and applications to one another, we consider numerous data points. Our experts start by comparing credit card processing rates, the presence of additional fees, contract length, sales practices, and the presence or absence of additional features and services, like point of sale software. Each provider is judged on its own merits and how well it stacks up to industry standards; then it is weighed against the other providers on the list.
We spend an average of 10-15 hours researching and updating each one of our lists, making sure every company or application included meets our internal standards for quality and reputation. Any list of recommended payment processors on our site might contain a mix of standard merchant accounts, third-party payment processors, mobile payment devices, and high-risk payment processors, depending on what our expert feels is the best fit for certain scenarios or business types.
For additional details about Merchant Maverick’s review and rating processes, please refer to any or all of the following methodology pages:
15
Years reviewing payment processors
100+
Providers evaluated
25
Attributes and features assessed per vendor
40+
Years combined experience
Cannabis is still a controlled substance under United States federal law, and the banks that issue credit cards are regulated at the federal level. Since the credit card processing networks that are used to process credit card payments have to comply with federal law, they cannot permit any cannabis sales to be processed over their networks.
Visa, Mastercard, Discover, and American Express have each stated publicly that they will not permit their cards to be used for cannabis sales, even if it’s legal under local state law. If you get caught trying to do it anyway, you’ll quickly have your merchant account shut down, and you’re very likely to be placed on the Terminated Merchant File (TMF) or MATCH list.
With credit cards off the table for now, cannabis merchants have had to get creative in finding ways to securely accept payments from customers. Here’s a summary of the most popular solutions currently in use:
Other alternative payment methods, including cryptocurrency payments, are trickier to implement and wouldn’t be our first-line recommendation for cannabis processing. While still offered by some cannabis payments providers, many merchants feel that cryptocurrency payments are simply too volatile to be a safe solution for their business.
Likewise, Point of Banking (or “cashless ATMs”)solutions came with a number of problems that caused the major credit card associations to withdraw support for them in 2022. Therefore, cashless ATMs are no longer a viable payment method for your dispensary.
Although we’ve given you four recommendations to start you on your search for cannabis payment processing solutions for your dispensary, there isn’t any single company that’s the “best” — or even the most affordable. You’ll want to find a provider that offers the best fit with how you want to run your business.
With that in mind, be aware that nothing in this article should be construed as legal advice. We strongly encourage you to seek out the services of a business attorney in your local area who can assist you in staying within the bounds of the law as it currently exists. We also recommend that you steer clear of any payment processor that promises to allow you to accept credit cards for cannabis products for the reasons discussed above.
For selling cannabis-related products, where you can accept credit cards, one of our recommendations for the best high-risk merchant account providers should be able to help you.
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The vendors that appear on this list were chosen by subject matter experts on the basis of product quality, wide usage and availability, and positive reputation.
Merchant Maverick’s ratings are editorial in nature, and are not aggregated from user reviews. Each staff reviewer at Merchant Maverick is a subject matter expert with experience researching, testing, and evaluating small business software and services. The rating of this company or service is based on the author’s expert opinion and analysis of the product, and assessed and seconded by another subject matter expert on staff before publication. Merchant Maverick’s ratings are not influenced by affiliate partnerships.
Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity. The editorial content on this page is not provided by any of the companies mentioned and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author’s alone.
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