Payment Automation for the Cannabis Industry

Several states have taken steps to legalize marijuana in some form, with 10 states and the District of Columbia legalizing cannabis for recreational use and 23 other states legalizing the use of medical marijuana. Yet the challenge on how cannabis companies can make payments remains present.

The main issue? Their complete reliance on cash to make and receive payments. This is primarily due to the Federal Reserve regulations still in place governing banks from allowing those in the industry to transfer funds.

We are noticing accounts payable automation vendors either throwing these clients off their systems or refusing to work with them. Why? The main cause is the solutions provider’s use of intermediary accounts.

What is an intermediary account? This is a bank account owned by the accounts payable solution provider. When their customer makes a payment to the vendor, the funds go to this account first (where they typically are earning interest on their customer’s money) and then releases the payment to the vendor.

Because of the federal regulations on the cannabis industry, the solution provider’s bank account may be flagged for misuse since the funds are being sent here from their customer.

The issue becomes incredibly important when you consider the amount of cash going in and out of these businesses. In addition, these are often setup in a franchise model where payments are being coordinated from multiple locations. There has to be a way to automate this process, bring efficiencies within accounts payable to this industry while complying with regulations in place.

At MineralTree we do not use intermediary accounts which allows us to work with clients within this industry to automate their payments. They are successfully managing large payment volumes by check (from their account), credit card, ACH or virtual card.

Contact us to learn how we can work with your cannabis company.


We're transforming accounting by automating Accounts Payable and B2B Payments for mid-sized companies. Our award-winning solution has helped over one thousand businesses transform accounts payable from a source of inefficiency and fraud risk to a secure and strategic profit center that provides visibility into key cost drivers.