Walk into almost any cannabis dispensary in America and you will see it: a sleek payment terminal sitting on the checkout counter, indistinguishable from the card reader at your local coffee shop. Swipe your debit card. Punch in your PIN. Collect your product.
Except nothing about that transaction is normal.
That terminal is not processing a retail purchase. It is being coded as Merchant Category Code 6011 — the code reserved exclusively for legitimate ATM cash withdrawals. It appears on the customer's bank statement not as a purchase at a dispensary, but as a cash withdrawal from a generic ATM — sometimes at an address that has nothing to do with the dispensary at all.
According to Bloomberg's reporting, cashless ATMs have processed more than $7 billion in payments despite public warnings from the card networks. Cannabis dispensaries processed over $30 billion in total transactions in 2024.
How the Scheme Works
An Independent Sales Organization (ISO) approaches a dispensary, claiming to install ATM terminals. No traditional ATMs arrive. Instead, the ISO configures the dispensary's existing POS terminals to route transactions through the ATM network using MCC 6011. Because the transaction is coded as an ATM withdrawal, no interchange fee flows to Visa or Mastercard.
Sources estimate the industry-average kickback at approximately $1.80 per transaction. At 400 daily transactions, that's $259,000 per year — per location.
Robbing the Consumer at the Counter
In a field test conducted by Regulated Green, a single pre-roll priced at $12.50 resulted in a total debit of $26.00 — a 48% effective fee rate — including $6.00 in charges that were never disclosed or consented to.
The Legal Framework They're Breaking
Under EFTA Section 904(d)(3) and Regulation E §1005.16, an ATM operator must disclose fees before the consumer is irrevocably committed. Under Regulation E §1005.7(b)(5), all fees must be disclosed.
Visa Strikes Back
Visa's secret shopper program identified over 100 Trulieve locations using cashless ATMs. Visa fined Pueblo Bank & Trust $950,000. Switch Commerce sued Trulieve in February 2025, alleging fraud and racketeering.