The sale of cannabis is legal in several American states including New York. Despite everything, distinctions are made between its recreational use, which is gaining ground, and medical use. But this new market has been held back for some time by two major payment networks: Mastercard and Visa.
The United States has 38 states that allow the sale of cannabis. Legislation varies between those that legalize the sale for medical use or for recreational use. In 2012, Colorado became the first US state to legalize the sale of recreational cannabis. Since then, 18 others have followed, including New York State. Florida, on the other hand, has authorized the medical use of this drug but not the recreational use.
But more recently, and as the number of states authorizing this use increases, the cannabis market is being held back by two major payment networks: Mastercard and Visa. At the end of July 2023, Mastercard announces that it is banning transactions in cannabis stores: “The federal government considers cannabis sales to be illegal, so these purchases are not authorized on our systems,” said a spokesperson for the company to Reuters. Such a measure was also taken previously by its competitor Visa.
When American federal law complicates everything
A real blow for the cannabis industry. Especially since the market for this product is still new in the United States and faces other major obstacles to expanding. As a reminder, cannabis is considered illegal at the federal level. A misunderstanding even though some states authorize the sale and consumption of this drug. Banks comply with federal laws.
The measures taken by Mastercard and Visa are increasing the number of customers who purchase with cash. A payment method that poses problems. According to public radio NPR, cannabis stores are facing security problems and armed robberies are on the rise in these businesses. Increased risk for smaller companies who cannot finance effective protection systems.
A golden future if the law becomes lighter
Despite these crippling measures for the cannabis market, the general legalization of this drug in the United States could cause sales to explode. The figure rises to $57 billion per year to US GDP by at least 2030. Some projections even suggest a figure of $72 billion, especially if regulations are relaxed.
New York is also one of the most prolific states after legalizing the sale of recreational cannabis in March 2021. The marketing of this plant could represent 1.1 billion euros in turnover, starting in 2023. Projections even estimate this figure at nearly 4 billion euros in four years. Competition is therefore tough between stores that sell cannabis and its derived products. Two camps oppose each other, businesses with a license to sell cannabis, of which there are three, while those without a license number around 1,400 according to the New York sheriff, Anthony Miranda.
2023-11-08 10:42:06
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