Federal regulations prevent traditional banks from allowing accounts for cannabis businesses despite their legal status within the state. This banking limitation creates a plethora of problems for business owners. The race to resolve the cannabis banking dilemma has been at the forefront of the cannabis industry for many years, but now, it appears, with technology advancements, one company may have found the solution.
Last week, CannabisTech had the opportunity to speak with Ken Berke, President and Co-Founder of PayQwick, about their partnership with Safe Harbor Private Banking to bring electronic banking to the Colorado cannabis industry. Sundie Seefried, Safe Harbor’s CEO spoke about the partnership in a press release, “I was concerned about the risks a cash-based industry poses to our communities, working with companies like PayQwick allows businesses to reduce the use of cash and the risks associated with it.”
|A Relationship a Year in the Making|
Although finalizing the partnership with Safe Harbor, a leader in compliance-based banking in the cannabis industry, took over a year, Berke mentioned it was more about due diligence and creating internal policies and procedures. “PayQwick saw no changes in the way we do business,” Ken explained, “we just had to establish a set of processes to deal with the money.”
|Experience Meets Innovation|
Safe Harbor clearly has the experience meeting compliance requirements for legitimate cannabis banking, as they currently serve more than 100 cannabis-based businesses and bank more than $1 billion in cannabis funds in the state of Colorado. With their partnership, PayQwick’s eCommerce Ethereum solution enables all cannabis-based businesses, as well as, the accompanying ancillary businesses, a way to conduct financial transactions without handling cash.
Known as the “PayPal of Pot”, the technology behind PayQwick’s system allows a ledger of transactions to track the cash in a manner showing compliance with federal banking regulations. Ideally, this partnership will allow Safe Harbor to create additional space for clients, where their capacity to handle cannabis businesses has been limited in the past. Although Safe Harbor has been handling cannabis banking since 2015, PayQwick’s Ethereum, cashless solution will allow for expansion, as well as, consumer inclusion.
“With our combined effort, the goal is to make communities safe by taking the cash off the streets. We are taking the cash out of the equation, both at a wholesale and a consumer level,” Ken stated.
|Benefits for Everyone|
In today’s world of cash-only cannabis business, many delivery drivers and store employees are putting themselves in a dangerous position. Many drivers may be carrying thousands of dollars in cash at any given moment, placing them at greater risk of violent crime. Business owners often have to make large cash payments to vendors, marketing firms, lawyers, and even to pay their taxes. This is not only dangerous, it is inconvenient and time-consuming.
PayQwick’s eCommerce solution allows business owners to conduct business transactions with trust and simplicity. In a demo, Berke explained how trust works in PayQwick. For example, if a dispensary is ordering from a new vendor they can place the funds in escrow. Once the dispensary sets the funds aside for the order, the vendor schedules delivery, and when the client receives the product, they release the funds to the vendor. Basically, the service allows the vendor to know the funds are available for the order, and it allows the dispensary to trust their order will be filled.
In addition, if the business needs to pay a utility bill or other bill, like taxes, with a client who is outside of PayQwick, the system’s bill payment option will generate and mail a paper check for seamless payment transactions with anyone.
The inconveniences of cash transactions impact all businesses who service this illustrious industry. Marketing firms, lawyers, printers, and more can feel the backlash from the cash-heavy environment of the cannabis industry. When they invoice their canna-business clients, rather than receiving a check they are often are met with a sack of cash at the door.
And the consumer, too
Consumers are also encouraged to get involved, as PayQwick can offer safer, more convenient ways to pay at the dispensary. Consumers may be wary of ATM fees or carrying cash for purchases when visiting the dispensary. Using the PayQwick service allows consumers more freedom and flexibility, as well as, safety and security when shopping for cannabis products.
Together, Safe Harbor and PayQwick are improving public safety by taking the cash off the streets and allowing legal, cannabis businesses the ability to operate and function like any
|About Partner Colorado Credit Union’s Safe Harbor Services|
Safe Harbor Private Banking, a Denver-based division of Partner Colorado Credit Union, is the leader in compliance-based cannabis banking. Concerned about the risks a cash-based industry poses to public safety and in keeping with the credit union philosophy of serving the underserved, Safe Harbor plunged into cannabis banking determined to take money off the streets and to offer law-abiding businesses a solution. CEO Sundie Seefried devised, tested and launched the cannabis banking program in 2015, which has withstood the scrutiny of federal and state regulators, earned praise from legislators and industry leaders and garnered national attention in the Wall Street Journal, Bloomberg News, and Reuters. For more information, visit www.safeharborprivatebanking.com
Founded in 2014, PayQwick brings proven payment processing, cash management, and banking services to the licensed medical and adult-use (recreational) cannabis industries. PayQwick is a proprietary technology and regulatory compliance platform that sets the “gold standard” for providing financial services to the cannabis industry. For more information about PayQwick, visit www.payqwick.com.