It’s an exciting time to be a cannabis entrepreneur, especially in newly-legal states like Rhode Island. With five state-licensed cannabis compassion centers scheduled to start selling recreational cannabis on or after December 1, 2022, new opportunities will continue to roll out in The Ocean State. New Rhode Island cannabis-related businesses (CRBs) and ancillary cannabis businesses (testing labs, transport and delivery, packaging and labeling, etc.) have a number of obstacles to clear on their way to opening day. Here’s a primer on what you’ll need to know about opening a Rhode Island cannabis dispensary, from applications and licensing to insurance, money management, and more. 

How To Get A Cannabis Business License In Rhode Island 

At present, Rhode Island state regulation provides for up to 33 retail licenses, distributed across 6 zones statewide. However, these licenses won’t be approved until 2023, at which time the RI governor appoints a Cannabis Control Commission. This state board will be in charge of overseeing licensing applications for adult-use and recreational only dispensaries. Until the Rhode Island CCC is appointed, cannabis consumers will be shopping at dispensaries that were previously medical-only, that have now expanded their licensing to sell adult-use products as well. 

Rhode Island Cannabis Dispensary Licensing Zones and Local Restrictions 

Below is a list of Rhode Island’s six dispensary licensing zones, as well as the towns and cities that are covered in each zone. Though cannabis is legal at the state level in Rhode Island, it’s important to note that each town or city within RI’s six zones may impose local restrictions on cannabis businesses. 

• Zone 1: Burrillville, Cumberland, Glocester, North Smithfield, Smithfield*, Woonsocket
• Zone 2: Central Falls, Johnston, Lincoln, North Providence, Providence
• Zone 3: Coventry, Foster, Scituate*, West Greenwich, West Warwick
• Zone 4: Cranston, East Greenwich*, North Kingstown, Warwick
• Zone 5: Charlestown, Exeter, Hopkinton, Narragansett, Richmond, South Kingstown, Westerly
• Zone 6: Barrington*, Bristol, East Providence, Jamestown*, Little Compton*, Middletown, Newport, New Shoreham, Pawtucket, Portsmouth, Tiverton, Warren

*Rhode Island cities that have prohibited cannabis sales

In November 2022, RI municipalities were given the option to opt-out of allowing recreational cannabis businesses by putting the issue to voters. The following RI municipalities do not permit cannabis anywhere, or enable it only under certain circumstances requiring a special use permit. 

• Barrington
• East Greenwich
• Jamestown 
• Little Compton
• Scituate 
• Smithfield

Cannabis Licenses Available in Rhode Island

The Rhode Island Office of Cannabis Regulation has four distinct cannabis sectors in which a CRB can obtain a license: compassion centers, cultivations, industrial hemp programs, and CBD consumables. The RI Office of Cannabis Regulation additionally provides education, training, and classes for getting licensed in each cannabis sector. 

• Compassion Centers – Medical dispensaries, which will eventually include recreational dispensaries. This sector includes any CRB that retails cannabis products, including but not limited to: whole flower, vape products, edibles, topicals, tinctures. 
• Cultivators – Cannabis agriculture operations, grow farms, etc. This includes vertically-integrated manufacturing companies that produce retail cannabis products, as well as lab testing, packaging and labeling. 
• Industrial Hemp Program – Industrial hemp cultivations, agricultural handlers and dual-grower/handlers that grow and/or manufacture hemp and hemp-derived products.  
• CBD Consumables – Any business involved in the cultivation, manufacturing distribution, and/or retail of CBD (cannabidiol) products

Financing A Rhode Island Cannabis Dispensary 

In 2019, despite having only three medical-only cannabis dispensaries in the state, RI cannabis sales topped $50 million and contributed over 1,098 full-time jobs to the Rhode Island economy. Despite the amount of money the industry brings to the state, the costs to open a Rhode Island dispensary can be prohibitively expensive. The non-refundable application fee alone is $10,000. Then, if your business proposal meets all the requirements, you’ll have to pay a $500,000 licensing fee – one of the highest in the US. With the high cost of entry to the industry, many prospective cannabis entrepreneurs are wondering, How can I finance my RI dispensary? 

It’s often difficult for cannabis entrepreneurs to find financing to open a new dispensary or CRB. Traditional banks and credit unions often shy away from even legal cannabis businesses, because the conflict at the federal level makes taxes and money management harder for cannabis businesses. Big banks usually prefer to stay hands-off when it comes to cannabis, leaving few options to raise enough capital for start-up expenses. 

Paybotic Merchant Cash Advance Program

Your Rhode Island dispensary isn’t a traditional business – and Paybotic isn’t a traditional bank. When you need a financial solution that understands the unique challenges of the cannabis industry, you need Paybotic. Our company has over a decade of experience working with cannabis businesses, and in that time, we’ve helped cannabis businesses weather the storms and changes of industry progress. 

We created the Merchant Cash Advance program as a unique alternative to a traditional loan to give cannabis businesses another option. Instead of a loan, Paybotic Merchant Cash Advances are advances on debit sales receivables. All your CRB needs to qualify for a Merchant Cash Advance from Paybotic is the ability to accept credit and debit cards. Your CRB gets funds disbursed in lump sums, and your repayments are made at a fixed percentage of daily credit and debit card sales processed until completed. 

Whether you’re thinking of opening or expanding a Rhode Island dispensary, there’s already a lot of worry about – let us help lighten the load. We’ve got a full suite of financial technology solutions built for the cannabis industry, including card payment processing, secure banking, gift card and loyalty programs, and more. 

To learn more about Paybotic’s merchant cash advance program or other ways we can help your Rhode Island cannabis dispensary flourish, set up an appointment to chat with one of our experts, without cost or obligation.