“An industry that employs hundreds of thousands of people, provides billions in economic benefits, and promotes safer alternatives to pharmaceuticals and commonplace vices continues to be treated like a pariah,” said one cannabis entrepreneur.
The company announced this week that it has instructed U.S. financial institutions to stop allowing customers to use its debit cards to purchase marijuana products at cannabis stores, which now operate legally in 38 states for medicinal use and 23 states for recreational use, as well as in the District of Columbia.
Mastercard said it made the decision because marijuana remains criminalized at the federal level, despite major progress in recent years as the Marijuana Opportunity Reinvestment and Expungement (MORE) Act was passed by the U.S. House last year.
Darren Weiss, president of multistate cannabis operator Verano Holdings, said Mastercard’s decision shows how the industry is still treated as a “pariah” despite its annual national sales projected to reach $57 billion by 2030, or as much as $72 billion including several states where cannabis is expected to be legalized.
A number of advocates including Sen. Jeff Merkley (D-Ore.) said Mastercard’s move demonstrates the need for the Secure and Fair Enforcement (SAFE) Banking Act, which would protect banks and credit unions for being penalized by federal regulators for working with legal cannabis stores.
“I will not stop pushing to get SAFE Banking passed so legal cannabis businesses can access necessary financial services,” said Merkley. “Cannabis businesses are still in dire need, and the majority of the country with state-legalized recreational cannabis can’t wait.”
While expressing appreciation for the SAFE Banking Act and its advocates in Congress, Weiss pointed out that the legislation would not address the fact that marijuana is criminalized at the federal level, which was the objection Mastercard said it has to working with cannabis dispensaries.
“SAFE Banking as drafted won’t fix the credit card issue, and Mastercard’s position won’t change as a result,” said Weiss. “We need comprehensive cannabis reform, and we need it yesterday.”
The “awful news,” said Columbia University fellow Raúl Carrillo, “shows the pitfalls of trying to reform cannabis finance without decriminalizing and legalizing weed on the federal level.”