There’s been a feud with cannabis and censorship since legalization began. Despite not breaking any laws the state, networking and connecting through social platforms -without fear of deletion- is not something our industry is accustomed to. That censorship, inevitably, falls to bigger institutions and even payment services. To remedy the situation, Valley National Bank is introducing plans for a secure web application for cannabis businesses.
Valley Pay will operate as a digital wallet. A digital wallet connects to a bank account to access funds; similar to Starbucks’ app. Cannabis businesses can use the app to have money from transactions transferred into their wallet. It’s similar to many other pay services online; but, all consider cannabis a “high-risk” business and refuse them. Cannabis-specific pay services are appearing but, Valley Pay would be the largest funded.
In the article published by Tearsheet, they further explain:
“With Valley Pay, the bank wants to migrate cannabis business’ cash usage to a secure, web application, “easing the burden on cannabis operators who are reliant on cash transactions today.” The new platform comes as part of Valley Bank’s push for cannabis banking, a project it calls its Cannabis-related Business (CRB) banking program. The bank says the program is designed to give legal cannabis enterprises access to banking solutions that will help them effectively grow and manage their business. Valley Bank wants to work with cannabis dispensaries, cultivators, testing labs, armored car services, wholesalers, and other CBD/hemp businesses.
Out of the billions spent on cannabis last year, the majority was paid for in cash. It’s no secret to anyone how much of a liability that is. Banks are terrified to touch cannabis, and rightfully so, given consequences from the federal government. State markets and businesses have found ways around it, but only temporarily. Cash always remains the default form of payment in cannabis. Another pay service like Valley Pay could offer aid to logistics and security.
The company hopes to even offer internal rewards that would work more seamlessly with a digital wallet. The goal is to avoid touching a card or cash. With versions of the SAFE Act recycling through Congress, the legislation could swing in their favor soon. The change would allow banks and card companies access. Valley Pay doesn’t see competition there as much as more opportunities to innovate a better system for cannabis. Valley National Bank hopes to launch the application in the coming months. Stay tuned for how it rolls out!