The news: FundCanna launched B2B buy now, pay later (BNPL) platform ReadyPaid to address the cannabis industry’s endemic cash-flow problem. 

Scale of the issue: The $35 billion US legal cannabis industry has a $4 billion delinquent receivables problem, per a report from Whitney Economics. “When nearly 20% of revenue is tied up in overdue payments, operators lose the ability to plan, invest or even survive,” chief economist Beau Whitney told Banking Dive. 

This is reflected in cannabis licensees’ reported profitability: As few as 24% of operators reported being in the black in 2023, per Whitney Economics’ US Cannabis Delinquency Report.

Regulatory constraints: Cannabis’ classification as a Schedule I drug has barred industry players from bankruptcy protection, common business tax deductions, and full spectrum banking services. 

But, traditional finance seems eager to embrace the cannabis business: 831 banks and credit unions served cannabis businesses in Q2 2024, per the Financial Crimes Enforcement Network. (Out of these few institutions, most likely only offered depository service—lending is still scarce.) 

And the number of marijuana businesses being served by those banks is surging—up to 21,239 by Q3 2024, indicating a key gap in available services.

Where ReadyPaid steps in: A B2B BNPL product can help cannabis businesses with their cash flow. 

Alternative lending gives manufacturers and dispensaries more time to make a return on their products to pay back sellers, while operating in a cash heavy, thin-margin industry.

Our take: Alternative financing pairing well with an alternative industry comes as no shock. 

If cannabis is finally descheduled by the federal government—or at least reclassified, as President Donald Trump has considered—ReadyPaid will have a harder time competing against traditional banks that likely will openly service weed-related business without regulatory threats.

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