What Are Cashless ATMs?
These systems let dispensaries process a purchase using a customer’s debit or credit card, but code it as an ATM withdrawal. The customer swipes their card, selects a rounded amount (e.g., $60), and the POS codes it under MCC 6011 (ATM) rather than marijuana. Instead of dispensing cash, the purchase is made and change given in cash.
Why Visa & Mastercard Are Shutting Them Down
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Unauthorized Bypass
The networks view cashless ATMs as disguised cannabis sales via ATM code, violating their rules.-
In 2021, Visa warned banks: this scheme “may operate in violation of the Visa rules.”
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By mid-2023, Mastercard similarly directed banks to terminate such activity.
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Enforcement Actions
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Major processors like NCR and Columbus Data Services shut them down in late 2022, impacting dispensaries nationwide.
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Visa began audits using “secret shoppers”—if violations were found, acquiring banks faced risks of fines and penalties.
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Real-World Examples
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In New Mexico, dispensaries like PurLife experienced abrupt shutdowns and reverted to cash after Visa’s warnings triggered payment errors.
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Bank fines followed—as with a lawsuit against Trulieve naming a $950,000 penalty due to ATM misclassification during Visa audits.
Why This Matters to MMJ Businesses
Payment Disruptions:
Sudden shutdowns of payment solutions—sometimes on the same day
Compliance and Fines:
Sponsor banks and payment processors being penalized—costs may filter to merchants
Operational & Safety Risks:
Return to cash-only mode brings theft risk, reporting complexity, and labor inefficiency
Summary
The era of cashless ATMs is ending. Major networks have deemed them violations of their rules, and both banks and ATM providers are pulling support. Dispensaries relying on these tools are being forced back into cash—despite the risks.
It’s time for legal-compliant MMJ businesses to shift to alternative payment methods such as verified eDebit, PIN-debit, or banking apps, which offer safer, more transparent, and sustainable processes than circumventing the rules.