The Tommy Chong Green Card, which sells for $19.95, is designed for use at medical dispensaries and recreational stores. These stores typically accept only cashand Chong's cards must be loaded using cash. The card is supported by Cannabis Merchant Financial Solutions, part of the FastFunds Financial Corporation, which is issuing the product as a "gift card" to address bank regulations.
But it's the price of the cards that's high, according to Madeline Aufseeser, a senior analyst at Aite Group.
"You can go to any Walmart or CVS or Walgreens and buy a gift card for $5 or less," she said, adding the expense counters any brand value that comes from being attached to Tommy Chong. "What they are charging for the card is absurd."
The cards will be distributed in Colorado, California and Washington state. Users will load the cards at dispensaries, but can use the cards at any store that accepts Tommy Chong cards.
Because marijuana is not federally legal, banks generally do not support its purchase, leaving transactions to alternative providers. Most recently, Global Payout developed a closed-loop system to encourage electronic payments for marijuana.
"Frankly that kind of price point for the Chong Card raises the antenna of regulators and consumer groups and does not bode well for the rest of the prepaid industry," Aufseeser said.
FastFunds and Cannabis Merchant Financial Solutions did not return a request for comment by deadline.
Chong is also partnering with Marisol Therapeutics to develop a marijuana strain called "Chong Star." The actor also brands a vaporizer. Tommy Chong cardholders can earn rewards and discounts for the purchase of these products.
Chong is the latest in a long line of celebrities to attach their names to a prepaid card, including the likes of Magic Johnson and Justin Bieber. Others, like Suze Orman and Russell Simmons, participated in the design of their cards.