Mastercard moves to ban cannabis purchases on its debit cards

“The federal government considers cannabis sales illegal, so these purchases are not allowed on our systems.”

Mastercard is not alone in shutting down mairjuana purchases that involve using their cards. Visa issued a similar edict to block transactions at dispensaries and other legal weed distributors, according to Bloomberg.

Read more: Anti-Doping Agency declines to remove cannabis from banned list

Since their inception, marijuana distributors have struggled to find ways to accept non-cash payments from customers. One common practice was using cashless ATMs, which served as a loophole that made it seem like the financial transactions occurring at dispensaries were merely account withdrawals, rather than product purchases, according to Bloomberg.

After regulators cracked down on the cashless ATM loophole, it became more common for people to purchase legal weed, using their debit cards and PINs, Bloomberg reported.

Tyler Beuerlein, an executive at Safe Harbor Financial Services, which does banking for the legal weed industry, warned that cannabis sellers could be running out of sales options.

“More people have migrated to PIN debit in the last year and a half as the cashless ATMs have had issues,” he told Bloomberg. “If the PIN debit solutions go away, it leaves people back with ACH or cash.”