That's not true at all. I live in the northeast and my dispensary simply can not take credit cards even if they wanted to; credit card companies are liable for the transaction and they don't want to run up against federal law.

Some dispensaries can take debit card transactions, and they have to do so through "high risk" processors... companies like Square will not work with them because of federal law.

Its hyper regional. And when processing solutions are found, they may be gone the next month. You see a similar situation with groups like Eaze in the SFBA. Some months they just don't have a debit option, some months they do.

>credit card companies are liable for the transaction and they don't want to run up against federal law.

This. And while it's obviously not the same thing at all, since cannabis is a schedule 1[0] substance, the US government could treat processing credit card transactions for cannabis companies the same as they treated HSBC[1] or worse.

As such, until cannabis is moved off of schedule 1, Congress acts to make cannabis legal at the federal level, and/or the US Department of Justice makes it clear that providing banking services to cannabis companies will not be prosecuted under money laundering laws, US banks won't jump into the pool.

[0] https://www.dea.gov/drug-information/drug-scheduling

[1] https://www.investopedia.com/stock-analysis/2013/investing-n...

Your assumption is wrong, they are being refused by Square, Stripe, etc, etc. CBD are also in a grey zone which cause them tons of problems accepting credit cards. This isn't because of higher processing fees.

Or they are working the system and making an ATM withdrawal look like a debit from the consumer's point of view.

How does that make any sense? I put my card into the reader and it debited from my bank account. I didn't pull cash from an ATM and there was no ATM present in the business.

In my country, one can perform debit card transaction with 'cash back' - if I'm in the grocery store buying $50 of groceries with my debit card, and I also want $30 of cash, they can charge my card $80 and hand me $30 from the drawer.

This was a great boon for banks a few decades ago, as it functionally gave them a huge ATM network for free.

The debit card system understands this sort of transaction, and doesn't charge the normal x% processing fee on the cash withdrawal portion of the transaction.

In other words, retailers can create transactions that are effectively ATM withdrawals - without an ATM.

In California they charge your debit card and return cash change. They even overcharge your card to ensure there is cash to give back. $5 or so.

This turns it into an ATM withdrawal apparently.

And the really nice thing about this is that there are no fees.

If I just need $80 or so (I think the limit is $100), it's faster to go to the local Walmart and buy a candy bar or something and get back $80 cash than to go the closest ATM owned by my bank to avoid the double dipping fees.

Our local grocery store (Fred Meyer, aka Kroger) has started charging a fee to take out extra and get cash back. Not a lot, but a bit annoying. I used to get cash that way all the time, but even for a nominal fee I just avoid that store now. I am weird, yes.

Yeah it makes sense there are no fees for cash back. Walmart doesn't want cash, they want to get rid of it as soon as possible.

The ATM has to be actually refilled with cash, so they charge you for it.

That doesn't really make sense. My bank's ATM has to be refilled with cash and they don't charge me. Likewise, I doubt the Walmart self-checkout is sorting bills and only dispensing $20's: they also have to be loaded with cash separately.

The only charges I encounter are from using my bank's card at another bank's ATM.

It probably depends on the type of account you have with the bank. I certainly don't pay ATM fees so long as I use my bank's own ATM but perhaps there are more bare-bones account types that do.