How COVID-19 Is Changing Payments

Posted on Apr 29 2020 - 7:38am by Editorial Staff

April 20th (4/20) is the biggest day of the year for cannabis retailers around the country. This is for good reason as the legend of “Weed Day” traces its roots back to the early 1970s. However, Weed Day 2020 is bound to be different than years past – especially as lockdowns in response to the COVID-19 pandemic remain in force.

As such, many in the cannabis industry are bracing for a heavier than usual day of online orders. While this will make it easier for retailers to thrive during this time of uncertainty, it also creates another problem for companies in this highly regulated business as they need a solution to process payments.

With that in mind, here is a look at how COVID-19 is changing payments for Cannabis and CBD purchases. While we are all getting used to the “new normal”, it is highly likely that when the lockdowns across the country are over, an increasing number of customers will prefer to get their weed and other products online and as such retailers will need a payment processing solution that can fit the unique requirements of the industry.

Curbside Delivery

One of the things that have remade marijuana retail in the age of COVID-19 is the advent of curbside delivery. This development was a reaction to lockdown orders around the country and the need for dispensaries to safeguard their workers.


As such, retailers have been accepting orders online or by phone and then having the customers drive up the retail locations for pickup. In doing so, the industry has been transformed in more ways than one.

For starters, the combination of curbside delivery and the lockdown has been a boon to the retailers across the country, as many customers have used this as an opportunity to self-medicate. As such, orders have continued to flow, while other industries have been hurt.

Also, many of these orders have gone online, and this has increased the need for a payment processing solution that can handle the demand. Adding to the challenge is the labyrinth of bank regulations put on the industry by federal and state governments. This can make it hard for a dispensary to open a bank account, let alone process credit or debit card payments.

As such as an entire industry servicing high-risk payments processing has sprung up. This includes companies like T1 Payments, which offer solutions to meet the merchant processing needs of industries such as marijuana. These solutions have helped to keep dispensaries alive.

While many dispensaries did accept credit and debit card payments before the crisis, most customers preferred to pay in cash. They would make a withdrawal from their bank’s local ATM before visiting their local dispensary, or they would withdraw from the ATM (either physical or virtual) at the location.

However, the lockdowns across the country have made this workaround next to impossible. Add to this the rise in online orders and dispensaries needed a solution that could step up to the new reality of curbside delivery. Not only does this reduce the need to handle cash when the customer drives up, but it helps the dispensary improve their cash control processes during the time of an unprecedented crisis.

Online Shopping

Besides curbside delivery, the industry has also seen a spike in online orders and deliveries during the lockdowns.  While ordering marijuana and CBD products online is not as easy as ordering something from Amazon, it is gaining in popularity.

Putting the logistics of online shopping aside, a vital component of a successful online sale is the payment infrastructure, and many dispensaries have needed to ramp up their website to meet demand. This includes what the customers see, such as the product gallery and check out as well as the gateways that will help to process the payments.

From there, some customers are opting for delivery of the product – though this very much depends on what is allowed by the state where they are operating. For example, some CBD products can be ordered, paid for, and delivered to the customer, while regulations in many places do not allow for home delivery of cannabis products.

However, these regulations have not stopped the shift in how customers are paying for their orders. This is a trend that is not expected to change anytime soon, not only because of the continuation of the lockdowns in many places but also because of the convenience online ordering and credit card payment offers customers. In many ways, this is a welcome change for dispensaries, and other high-risk businesses as moving towards credit and debit card payments mean that the retail locations are handling less cash and, by extension, do not have to worry about cash management issues which have plagued the industry for years. As such, COVID-19 is changing payments for cannabis and CBD, and it is expected that this could continue even after the emergency is over.

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Editorial Staff

Editorial Staff at I2Mag is a team of subject experts.