Cashless ATMs vs. Compliant Merchant Processing


With banking options still difficult for cannabis businesses to access – including the ability to accept debit and credit cards – cannabis companies are still searching for ways to facilitate their merchant processing needs. In a bid to take less cash and offer more payment options to their customers, some dispensaries and other cannabis-focused businesses have turned to cashless ATMs as a workaround that “allows” them to accept debit cards at the checkout counter. While it may seem like a decent alternative, there are plenty of reasons to forego cashless ATMs altogether, first and foremost that these workarounds are patently illegal. Here’s what you need to know about cashless ATMs and how compliant merchant processing solutions stack up. What are cashless ATMs? Rather than utilizing a traditional ATM kiosk on site, a cashless ATM looks more akin to the credit or debit card processors that most point-of-sale systems use. Rather than using them to complete a transaction, a cashless ATM debits the amount of cash needed to cover a purchase. These amounts are not precise; for example, if a purchase is for $73, a cashless ATM will withdraw $80 (plus fees), and the customer will receive $7 in change. While this entire process is different from a traditional ATM kiosk that most consumers are familiar with, and more Americans rely on plastic than paper when it comes to currency, proponents of cashless ATMs believe the alternative is a way to get around traditional banking institutions and their skittish stance toward the cannabis industry. The issues with cashless ATMs While they may seem like a balm for an industry being unfairly restricted from obtaining proper banking solutions, cashless ATMs can create several major issues for businesses using the technology. As a workaround for traditional banking solutions, their safe and legal use should be taken…

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