Close this search box.

From Cash-Only to Cashless: How The SAFER Banking Act Will Reshape The Cannabis Payments Industry

The winds of change are sweeping through the United States cannabis industry as the Senate Banking Committee achieved a historic milestone on September 27, 2023. In a resounding display of bipartisan support, they advanced the federal cannabis banking reform initiative, the Secure and Fair Enforcement Regulation Banking Act (SAFER Banking Act or SAFER).

This momentous development paves the way for state-legal marijuana businesses to access essential financial services. As this bill now heads for a Senate floor vote, a sea of opportunity is set to flood the U.S. cannabis market, potentially revolutionizing the industry’s financial landscape.

While the bill’s fate hangs in the balance, fintech trailblazers offering cashless payment processing and a suite of retail services have been at the forefront of propelling the industry forward, despite the limited access to traditional financial resources. The pressing question arises: How will the passage of SAFER impact fintech companies and the industry at large?

Gradual Implementation

The cannabis industry has been patiently waiting for the federal government to step up, and if SAFER passes, the transformation won’t happen overnight. Recent revisions to the bill indicate that the Treasury Secretary will have one year to issue updated guidance for banks serving the cannabis sector. This is a significant extension from the initial 180-day timeframe stipulated in the earlier version of the SAFER Banking Act, which originally surfaced during the Obama administration in 2014.

It will take some time for mainstream banks and other traditional financial services providers to enter the cannabis space to offer additional pathways for banking and digital payment processing. An average of 25-30% of all dispensary transactions across the industry rely on these cashless payment processing services. Therefore, during this transitional phase, existing cashless payment services will remain essential.

Major Credit Card Companies Remain Cautious

With the potential passage of SAFER, banks will be able to service cannabis companies by offering bank accounts and lending services to businesses. However, since major credit card companies ultimately control debit and credit card transactions, it may take some time before they allow cannabis transactions to mirror traditional retail sales, which conduct 80% of sales without the use of cash. Treez speculates that industry giants like Mastercard and Visa may wait for federal rescheduling before fully embracing cashless payment transactions for cannabis purchases.


READ MORE: Global Cannabis Industry Faces Fresh Banking and Payment Hurdles As Mastercard Bans Cannabis Purchases

Mainstream Retail and Technology Players Emerge

As the regulatory landscape becomes clearer, the industry is likely to see tech giants and traditional retail companies looking deeper into the U.S. cannabis market. For instance, Square has already kindled a partnership with a cannabis e-commerce platform in Canada, offering a glimpse of potential collaborations in the U.S. Shopify, a global commerce platform powering countless businesses, currently restricts the use of Shopify Payments for the sale of hemp or CBD products.

However, they have partnered with several integrated third-party payment gateways that support the sale of hemp and/or hemp-derived products. With the potential passage of the SAFER Banking Act, doors will open for similar partnerships between cannabis fintech firms and mainstream retail technology companies.

These fintech companies have meticulously crafted technology platforms tailored to meet the unique needs of the cannabis industry, amassing a wealth of invaluable data and insights in the process that non-cannabis tech firms would look to leverage and partner with. Their specialized infrastructure equips them to navigate the complex nuances of cannabis regulations, setting the stage for partnerships and mergers in the post-SAFER era.

The Road Ahead

While some legislators eagerly push for the bill’s prompt vote, it must garner 60 votes to clear the Senate. Roadblocks abound on both sides of the upper chamber, including opposition in the House of Representatives, where the original SAFE Banking Act was passed seven times.

Nevertheless, Treez stands ready and eager for the day when mainstream retail, tech, and banking services enter the cannabis industry. As this transformative journey unfolds, Treez is poised to play a pivotal role in shaping the future of the cannabis payments landscape.


John Yang is an expert in enterprise cloud commerce technology. Yang co-founded Treez in 2016, in response to the demand for software solutions that drive innovation and automate workflows specific to the needs of the cannabis industry.

Prior to founding Treez, Yang consulted at Slalom Consulting, a world leader in business technology where he specialized in program management, business improvements, software development, CRM solutions, and business intelligence. Leveraging his expertise and passion for technology, Yang built Treez to streamline retail operations within the cannabis industry and has since become the leading commerce platform for the highest volume retail operators in the biggest state markets in the cannabis industry.

Related Posts

Related Posts


Related Posts

Related Posts

Recent Posts

Related Posts

Subscribe to our mailing list to receives daily updates!

We won’t spam you


Browse by Tags




© 2023 Prohibition Holdings Ltd. All Rights Reserved.


Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?