Jim Krawczyk, Senior Director of Sales
The legal cannabis industry grew over 30% in 2022 to an estimated $30 billion market. Experts predict sales could reach $72 billion by 2030, fueled by progressive legislation and shifting public perceptions.
Heading into 2024, What Trends Await Cannabis Retailers?
Here are Three Likely Predictions.
Banking Access Inches Forward, but Cash & ATMs Still Dominates
In September 2023, the Secure and Fair Enforcement (SAFE) Banking Act passed a key Senate committee vote. The landmark bill would allow legal cannabis businesses access to banking services. However, passage faces obstacles, and financial institutions won’t be required to work with the industry.
Most experts agree the true differentiator for creating easy, safe banking is federal legalization – which is still years away. While banking progress will likely be incremental next year, cannabis retailers shouldn’t count on digital or card payments being an option in the immediate future.
Cash will continue to dominate cannabis payments in 2024. And having an ATM or multiple ATMs on-site will be more important than ever as Visa and MasterCard continue their efforts to shut down ‘work arounds’ that violate the federal regulations they must abide by like so called cashless ATMs, which attempt to fool processors into believing the dispensary is using a cash dispensing ATM, and PIN based debit.
Choosing the right ATM provider is important. With so many dispensaries operating in multiple states, it’s vital to work with an ATM provider that can service all your locations – with the experience and longevity to expand to new regions of the country as your business grows. This ensures your business operations do not get interrupted.
Rescheduling Will Boost Legitimacy, Not Sales
Federal officials recently proposed rescheduling cannabis. This move would be the first rescheduling since the Controlled Substances Act in 1970. While this move won’t immediately legalize marijuana, it will potentially ease research restrictions and reduce penalties.
While rescheduling doesn’t fundamentally alter legality, the research doors it will open could bring more medical credibility and product innovation to the industry. Things like targeted CBD therapies, further understanding of which oils and dosages target specific ailments, and so on. This scientific validation helps mainstream public perceptions while potentially boosting medical cannabis and health-focused branded products in retail.
Cash Draws More Crime Concerns
Despite progressive policies, cash-intensive cannabis retail will continue to attract crime in 2024. The understanding that cannabis retailers handle large cash volumes makes them a target. Dispensaries get robbed around 3-4 times more often than average businesses. The issue is bad enough that most states now allow armed guards and set strict security rules. Yet problems persist even in legal markets.
With federal legalization still an unknown, dispensaries will still need to rely on surveillance and smart cash handling processes, such as smart safes and cash recyclers, to help deter theft and protect revenues.
Dispensary location also plays a role, as disadvantaged neighborhoods often see disproportionate shares of cannabis crime. State legalization laws also play a role as cannabis-focused financial institutions begin to make headway across the U.S. – largely based on state-by-state regulations. However, until Federal laws around cannabis and marijuana banking change, security will remain critical.
Looking Ahead
The road toward normalized and financially integrated legal cannabis remains long. But 2024 should bring measured progress. Retailers must stay vigilant that they aren’t fooled into providing customers with ‘work around’ payment options which violate federal regulations and handling cash, while leveraging incremental legitimacy gains to grow their customer base. Further legislative changes may begin to arrive as early as late 2024. But, while real changes won’t be in the near future, next year’s incremental policy shifts set the stage for more substantial reform.
Ensure Your Success in 2024!
Learn More about Free ATM Placements and Cash Management Solutions
Jim Krawczyk
Senior Director of Retail Sales
Cell: (832)-264-4154