The state of Louisiana has entered legal marijuana territory with medical cannabis access beginning this week. As a result, the state has also entered the troubled waters of cannabis banking, with legal players in the state’s marijuana industry struggling to access banking and financial services.
Global Payout Inc. subsidiary MTrac Tech Corp. announced Monday (Aug. 5) the launch of its MTrac payment platform in the state, designed to facilitate payments down the marijuana supply chain. The platform will go live the same day the state’s legal medical marijuana market goes live, Tuesday (Aug. 6).
According to MTrac, its payments platform was developed in cooperation with “the main bank in Louisiana” that plans to provide bank account services to the state’s marijuana-related businesses. Though the company did not say which bank this is, MTrac said that collaboration will enable it to provide card processing services and B2B payments down the industry’s supply chain.
“Louisiana represents a special market for MTrac,” said the firm’s Chief Compliance Officer Jason LeBlanc in a statement, who added that MTrac’s payments platform makes Louisiana “the first state in the nation that will not be subjected to the cannabis industry’s all too common ‘cash only’ environment.”
“Our commonsense solution makes businesses and communities safer and provides a digital avenue for tax payments, while the transparent tracking features of the ledger lowers the risk for participating banks and helps to prevent tax evasion and money laundering,” LeBlanc added.
MTrac added in its announcement that it aims to operate as an example for other states that have legalized marijuana for recreational and/or medical use.
The U.S. Congress is still exploring how to address the challenge of connecting marijuana related businesses that operate legally at the state level but illegally at the federal level to financial services. Last week a coalition of more than 100 businesses called on Congress to pass a recently-revised bill that would legalize marijuana at the federal level and open up the nation’s banking system to companies in the market.
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