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A vertically integrated cannabis business with operations in 12 U.S. states, Columbia Care, introduced the Columbia National Credit program to give clients more payment choices.
The decision by Columbia Care shows how a private company is learning the financial ropes and taking matters into its own hands in a sector that is beset by the fact that its main product is unlawful under federal law and the associated banking challenges.
Why Use A Cannabis Credit Card?
Only Columbia Care dispensaries now provide the Columbia National Credit program. Dispensaries in New York were the first to accept cashless payments in 2018, followed by those in Delaware and Pennsylvania. Illinois and Arizona came later to join this initiative. Columbia Care Management hopes to have the credit program available at all U.S. retailers.
In addition, the business is evaluating opportunities to work with other companies to expand the program to their markets.
Credit Card for Cannabis Now Available
When customers used the Columbia National Credit card during a 2018 test program in New York, the company recorded an increase in basket size of 18%. Delivery transactions, which generate 10% of the company's revenue in New York, make the rise even more obvious. The basket sizes were 40% larger for delivery clients paying with a Columbia National Credit card than for in-store shopping.
More generally, the sector is still debating issues related to banking, credit, and cashless transactions. Legislators in California are working to create what would appear to be a state-chartered banking system for the cannabis business by allowing banks and credit unions to take cash deposits from dispensaries.
The SAFE Banking Act, which would protect financial institutions from criminal prosecution while conducting business with the cannabis industry, is also being advanced by federal legislators in Washington, D.C.
Where Can the Card Be Used?
The Columbia National Credit card can only be used at the company's dispensaries right now, but there is optimism that it might ultimately be accepted elsewhere. To establish the card as the top credit payment option in the whole cannabis market, Columbia Care is currently examining strategic and targeted collaborations. Furthermore, even though it is presently the only credit card available in the whole cannabis industry if it is successful, this market might become oversaturated.
Benefits of the Columbia National Credit Card
What are the advantages of the new cannabis credit card for applicants, then? The card gives individuals who need medical marijuana another way to pay for their medications. Some customers favor using credit when given a variety of payment options. Columbia Care is attempting to fill the vacuum left by the cannabis industry's failure to take this desire into account. However, it wasn't as simple as just designing a credit card for medical marijuana users. The corporation first had to negotiate the complexity of the banking sector, which was more difficult when it came to marijuana.
But the outcome is something that the medicinal marijuana industry as a whole is praising. The lack of a trustworthy electronic means of payment has long plagued the business as a result of federal regulations. In addition to providing cardholders with a fresh, simple method of paying for medical marijuana from authorized dispensaries, the new Columbia National Credit card also has some great benefits. These advantages consist of:
- No yearly charge
- Members-only access to deals and other promotions
- Members-only activities
- A telephone number for cardholder priority
- Online payments and account management
- If members pay on time, there are no interest or fees
A credit card gives Columbia Care an edge
As previously mentioned, Columbia Care will have a distinct advantage over its competitors because no other cannabis firm in the US allows its consumers to pay with credit, providing them with a flexible payment option that is lacking in the cannabis retail industry. Columbia Care provides an alternative for customers who don't want to buy marijuana with cash, which might enable the business to reach a wider customer base.
Any advantage over the competition will be crucial as the marijuana market matures in the US and rivalry for businesses operating there increases. If Columbia Care decides to make its cards available to others in the sector, it might create a completely new source of revenue in addition to helping the company increase sales.
Conclusion
Columbia Care provided new opportunities for consumers who don’t want to pay with cash. This innovative approach can change the entire marijuana industry by allowing consumers to pay with their cards without any hassle.
