Despite legal cannabis being a roughly $24 billion business in the United States, many dispensaries are in a bind when it comes to the simple mechanics of accepting payments for their products and services. While the banking forecast for dispensaries has brightened considerably in the last few years, the fact is that an estimated 70% of all dispensary transactions still take place in cold, hard cash.
Fortunately, we’re here with a bit of good news: Depending on your location, you may have a clever, intuitive and easy solution at your fingertips. We’re talking about CanPay, a service that links customers’ banking accounts with merchants by way of a standard bank-to-bank transfer service.
In today’s post, we’ll introduce you to CanPay and detail the steps you as a dispensary operator would need to take to get set up!
CanPay: A Solution for Dispensaries’ (and Customers’) Cash Woes
If you’re a cash-only dispensary, you’ve probably heard every possible complaint from customers by now. Either they need to plan ahead and bring sufficient cash, or be willing to pony up the extra fees for those in-store ATMs. And don’t even start on the hassles dispensary staff face managing large bundles of cash and making time-consuming (and potentially dangerous) daily trips to the bank.
These are exactly the problems CanPay was designed to solve. So far as customers are concerned, it’s merely another mobile phone app that allows them to pay for purchases at those dispensaries who offer it as a service option. At the moment, CanPay services dispensaries in some 28 states and the District of Columbia.
CanPay is quick and easy to set up. Better yet, there are no hidden “convenience fees” charged to customers, so the service presents an immediate upside (and a potentially major upside if you’re one of the first dispensaries in your area to offer it). That said, some banks do charge a small fee for ACH transactions. You’ll want to check with your banking representative for specifics and inform your customers accordingly.
CanPay: Specific Advantages, How to Get Set Up
If you can’t tell, we’re pretty excited by this new debit system, and we want to make it easy for you to get set up to take advantage of it. CanPay is designed for seamless integration and transparency:
- All members of the payment chain see your DBA and relevant company information, which tends to lessen fears about transparency or data privacy
- CanPay is US-based, so financial transactions take place in real time and are subject to standard consumer and merchant protections
- The payment process is designed to look familiar and intuitive, so customers don’t have to learn a new system of transferring funds
- Because customers tend to spend more when paying electronically, CanPay tends to increase sales
- Similarly, because customers aren’t forced to limit their spending to actual cash on hand, using CanPay increases opportunities to upsell at the point of purchase
- Because it reduces physical cash on hand, CanPay contributes to a safer working environment for dispensary staff
- Because of all the advantages to electronic payment, CanPay drives traffic to those dispensaries that offer it
- CanPay offers transactional, daily batch, and end-of-month reporting
What are the requirements to get you set up to accept CanPay? You’ll need a verified account at a banking institution approved by CanPay. Why? The company operates on a “Closed Banking Feedback Loop,” a system designed to maintain compliance with the Cole Memo and guidance from the Financial Crimes Enforcement Network.
At the moment, CanPay only integrates with customers’ bank accounts, not their credit cards. As debit cards currently account for roughly two-thirds of cashless transactions, that hasn’t been a major stumbling block for CanPay’s functionality.
Are you ready to get set up with CanPay? Reach out to the company for specifics on requirements and the type of information you’ll need to supply. We believe CanPay represents a majoe leap forward in the normalization and streamlining of dispensaries’ financial practices, and—given all the potential upsides for retailers—we hope you take advantage of this service if it’s available in your area!