This Earth Day we are reflecting on sustainability in financial services. While many advancements — specifically the adoption of electronic payments — have been made in financial services, the cannabis industry continues to be plagued by high cash volumes due to regulations.
The first factor impacting sustainability is the material that goes into manufacturing both paper and coin currency itself. While cannabis businesses can’t change the material money is made of, there are some things we all can do to increase sustainability in our operations.
Source: Hanegraaf R, Jonker N, Mandley S. and Miedema J (2018); Life Cycle Assessment of Cash Payments; DNB Working Paper n°610, Cash Essentials
1. Reduce the use of coins
While it may not always be possible, some cannabis retailers have eliminated the need for coins altogether by figuring tax into product prices, which results in whole dollar amounts at checkout. For transactions that do need to be in cash, this means less handling and transporting coins and reducing the amount of coins needed in circulation.
2. Offer cashless payment options – Retail & Wholesale
The energy used to transport currency is the most significant environmental impact factor. While cash can’t be eliminated, it can be reduced. For retailers, the use of cashless ATMs can reduce cash handled by nearly 40%. Manufacturers and growers, if working with the right financial services providers, can offer ACH as an option for transaction settlement for wholesale payments.
3. Reduce ATM Energy Consumption
If your ATM can be powered down overnight, consider this as a step to reduce the environmental impact of financial operations. Nearly 25% of the environmental impact of the cash cycle is due to ATM power consumption. While ATMs may be used less than 10 minutes per hour during the day, most cannabis business ATMs aren’t used after business hours at all.
Improving sustainability doesn’t always require radical changes to your business operations. What’s more, these changes can even have a positive impact on your revenue and profitability. Adopting one or all three of these suggestions will have a positive impact on both your business and the environment.