American Express Nixes Purchase of Medical Marijuana

Even though the purchase of marijuana for medicinal purposes is legal in 15 states, American Express will no longer allow cardholders to pay for such purchases with their cards. Purchasers can still use their VISA, MasterCard and Discover cards, but they might want to leave their AmEx cards at home.

The Medical Uses

Stoners might tell you marijuana is good for curing a stomach ache, nausea and a slew of other things. But you don’t have to be a stoner to reap the benefits of marijuana, as it is now legal in 15 states to use the herb for medical purposes. Doctors prescribe the herb as they would any other medication, and patients head over to their local dispensary to get their prescription filled. Some of the conditions which warrant a prescription include nausea,vomiting, and lack of appetite among chemotherapy and AIDS patients, as well as glaucoma and gastrointestinal illness.

AmEx Backs Out of the Business

Despite the fact that people making purchases at legal dispensaries are doing nothing illegal according to their state’s laws, AmEx has apparently decided to adhere to the federal law in this matter. The blog LASnark was the first to release the news, citing an email notice from a dispensary in Hollywood called The Farmacy. The email stated that AmEx had opted for a nationwide policy change. According to the dispensary, beginning on April 30, they were unable to process any transactions on AmEx cards and the company informed them of new guidelines. Others have attempted to contact the company, and they denied the new policy. However, according to the LA Weekly, an AmEx spokesperson confirmed the new policy. Although the company has gone back and forth about these changes, it seems they are indeed declining all purchases at dispensaries.

It’s unclear why the company has decided to stop supporting the legal purchase of medicinal marijuana, especially when the three other major credit card companies continue to do. Since AmEx cards are frequently used as business accounts, they could be attempting to avoid issues with employee purchases, as mentioned in the LA Weekly. Lucky for medical marijuana users, they can probably still resort to their debit cards, as most are tied to Visa. And there’s always cash.

Kristie Lorette

Kristie Lorette is an award winning credit specialist and an MBA graduate of Nova Southeastern University. Her lengthy tenure includes service at Merrill Lynch where she oversaw a $300 million dollar portfolio and 16 branches. At Merrill Lynch, Kristie specialized in consumer issues related to credit and mortgages. As a writer and researcher in personal finance, Kristie is also a contributor to Yahoo! Shine, Quizzle.com, Moneysmartlife.com and many other online and print publications.