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he replaced Sen. McConnell as majority leader, he would only cash payments, since credit card networks refuse to
put legalization legislation up for a vote. accept transactions from these businesses due to federal
prohibitions. Some payment processing companies fo-
President-elect Biden said throughout his presidential cused on serving state-authorized marijuana businesses
election campaign that he favored decriminalizing mari- have created workarounds, such as cashless ATMs, which
juana at the federal level, and legalizing marijuana for me- route PIN-authorized credit and debit card payments
dicinal uses. Vice President-elect Kamala Harris previous- through ATM networks.
ly co-sponsored the SAFE Banking Act, which sought to
establish a safe harbor for financial institutions that bank The market for payment processing services extends be-
cannabis businesses. Although that legislation garnered yond cannabis dispensaries and includes thousands of an-
approval from the House, it, too, was stalled in the Senate. cillary businesses, such as growers, testing labs, distribu-
tors and companies selling cannabis-related products that
Biden's choice to lead the Commerce Department, Rhode have been restricted from the major credit card networks.
Island Governor Gina Raimondo, supports legalization.
In 2019, Raimondo described full legalization as "the next While the ETA's Talbott said the chances of something like
logical step." And in a December interview with the Provi- the SAFE Banking Act passing in the new Congress are
dence Journal, she said cannabis legalization "is only a mat- improved, it would not signal a rush of activity. The Fed-
ter of time." As Commerce secretary, Raimondo would be eral Reserve would need to create a rule set for inter-bank
the cabinet official responsible for representing business clearing of transactions related to cannabis businesses; the
community interests and promoting economic growth. card networks would need to sign off, too. "These type of
changes are done in incremental steps," Talbot said. But
Legal marijuana sales represent a multi-billion-dollar once all the legalities and rules are in place, he added, "the
market—about $15 billion in 2021, according to Arcview payments industry stands ready to provide all the benefits
Market Research. [of electronic payments] to legal cannabis businesses."

However, most businesses selling marijuana, and related Patti Murphy is senior editor at The Green Sheet and co-host of the
products and services, remain unbanked, forced to accept
Merchant Sales Podcast. Follow her on Twitter @GS_PayMaven.

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