The cannabis industry generates billions — but most banks still won't touch it. Here's the honest truth about financing cannabis-adjacent businesses and what Merchant Fund Express can actually do for you.
Because cannabis remains a Schedule I controlled substance under federal law, Merchant Fund Express cannot provide financing to dispensaries, cultivators, processors, or any business that directly handles, sells, or produces cannabis products. We do not make exceptions to this policy regardless of state legalization status. If your business directly touches cannabis, we are not the right lender for you — and we want to be upfront about that.
The U.S. cannabis market surpassed $30 billion in legal sales in 2025, yet the majority of cannabis-related businesses operate in a financial no-man's land. Federal banks and most institutional lenders refuse to work with cannabis companies because federal law still classifies cannabis as a Schedule I controlled substance. This creates a massive funding gap not just for dispensaries and cultivators, but for the thousands of businesses that service them.
Ancillary cannabis businesses — companies that earn revenue from the cannabis industry without ever handling the plant — face a unique challenge. They serve a booming market, generate strong revenue, and often have better cash flow than comparable businesses in other industries. Yet many traditional lenders won't touch them simply because "cannabis" appears in their business description, website, or client list.
At Merchant Fund Express, we evaluate ancillary businesses on their own merits: revenue, cash flow, time in operation, and repayment capacity. If your business does not directly handle cannabis products, we can evaluate your application without industry prejudice.
An ancillary cannabis business earns revenue from the cannabis ecosystem without ever handling, processing, selling, or distributing cannabis products. These businesses include:
If you operate in one of these categories, your revenue is earned through legitimate commercial transactions and your business qualifies for evaluation under standard lending criteria.
The ancillary cannabis market has its own set of cash flow dynamics that create predictable, recurring capital needs:
Cannabis packaging companies often need to purchase raw materials — films, inks, resins — weeks or months before converting them into finished goods and invoicing clients. Manufacturers face similar cycles where equipment must be ordered, built, and delivered before payment is collected. Working capital bridges this gap.
Packaging manufacturers, testing equipment suppliers, and grow light companies require significant capital equipment. A single commercial packaging line can cost $50,000 to $300,000. Equipment financing spreads that cost over time and preserves working capital for operations.
Many ancillary businesses sell B2B on net-30 or net-60 payment terms. When clients are large multi-state operators (MSOs), payment cycles can stretch further. Invoice factoring turns those outstanding invoices into immediate cash.
As new states legalize cannabis, ancillary businesses face opportunity to expand into new markets rapidly. Hiring sales staff, attending trade shows, building out logistics, and scaling production all require capital that revenue alone may not support in time.
Flexible capital for inventory, payroll, marketing, and day-to-day operations. Repaid over 3–24 months with fixed daily or weekly payments.
Learn MoreFunding based on monthly revenue rather than credit score. Repaid as a percentage of future sales — flexible for businesses with variable income.
Learn MoreFinance packaging equipment, manufacturing machinery, technology hardware, or other capital equipment. Terms up to 60 months.
Learn MoreTurn outstanding B2B invoices into immediate cash. Ideal for ancillary businesses with strong clients but slow payment cycles.
Learn MoreRevolving credit you draw as needed and repay over time. Perfect for businesses with fluctuating capital needs across expanding markets.
Learn MoreFixed daily or weekly ACH payments calibrated to your revenue. Scales with your business rather than holding you to rigid terms.
Learn MoreAncillary businesses in the cannabis space are evaluated using the same criteria as all MFE applicants. Your industry is not held against you — your financials tell your story:
The application process takes about 10 minutes. Here is what to expect:
Have questions about whether your specific business qualifies? Call our team at (305) 384-8391 before applying. We will give you a straight answer.
As of 2026, 38 states have legalized cannabis in some form. Each new state that comes online creates demand for packaging, compliance software, security systems, grow equipment, marketing services, and dozens of other ancillary services. The Marijuana Policy Project estimates that for every dollar of cannabis sold, $0.60 to $0.80 circulates through ancillary businesses.
That means the ancillary cannabis economy may already be larger than the plant-touching market by total economic impact. And unlike dispensaries and cultivators, ancillary businesses can operate with standard banking relationships, maintain accounts at federally-chartered institutions, and access conventional financing — or alternative financing like that offered by Merchant Fund Express.
The businesses that service the cannabis industry are positioned for consistent growth regardless of federal rescheduling decisions. Packaging companies, tech providers, and equipment suppliers already serve multiple industries and can weather policy uncertainty better than their cannabis-dependent counterparts.
No. Because cannabis remains a Schedule I controlled substance under federal law, Merchant Fund Express cannot provide financing to plant-touching cannabis businesses including dispensaries, cultivators, and processors. However, we actively fund ancillary cannabis businesses that do not handle the plant itself.
MFE can fund cannabis packaging companies, equipment manufacturers and suppliers, cannabis software and POS technology companies, marketing and branding agencies serving the industry, security companies, commercial real estate businesses serving dispensaries, and consulting firms — as long as they do not directly touch or sell cannabis products.
Eligible ancillary businesses can qualify for $5,000 to $500,000 depending on monthly revenue, time in business, and credit profile. Working capital loans and merchant cash advances are the most common products for businesses in this space.
Typically 3–6 months of business bank statements, a completed application, and basic business information. Additional documentation may be requested for larger loan amounts. The application process takes about 10 minutes.
Approved businesses can receive funds in as little as 24–72 business hours after submitting complete documentation and receiving approval.
Most of our products are unsecured and do not require hard collateral. Merchant cash advances and working capital loans are approved based primarily on business revenue and cash flow, not physical assets.
We work with credit scores as low as 500. Revenue and cash flow are often more important than credit score for approval. Strong monthly deposits can offset a lower credit score.
Yes. Cannabis packaging manufacturers and suppliers can apply for equipment financing to purchase or lease manufacturing equipment, printing machines, labeling systems, and related machinery — provided the business does not directly handle cannabis products.
If your ancillary business serves the cannabis industry without handling the plant, we want to hear from you. The application takes 10 minutes.
Start Application Call (305) 384-8391Reviewed by MFE Funding Team | Updated March 2026
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