Canada Report – Online Storefronts are the Future of Legal Cannabis

by Web Test


This article was originally published by Tantalus Labs as ‘eCommerce can Age-Restrict Cannabis Access Better than Storefronts’

Myth: retail storefronts are the best way to age-restrict access to cannabis

Counterintuitively, eCommerce can verify identities through software with fewer errors than humans working at a storefront. Mail-order cannabis currently utilized by the Marijuana for Medical Purposes Regulations (MMPR) can leverage proven software to better verify identities and ages than the protocols in physical storefronts such as liquor stores.

The Government of Canada has repeatedly underscored the importance of age-restricting cannabis access. Age restriction stands alongside diversion of revenues to the black market and implementation of strict quality assurance standards as a pillar of the Liberal Party of Canada’s commitment regulated future for cannabis in Canada. In the “Designing an appropriate distribution system” section of their consultation document, Health Canada states:

In the initial stages of legalizing marijuana, only allowing a proven system of distribution (e.g., through the mail, as is currently done in the medical marijuana regime) could minimize the risks of uncontrolled/illegal retail sales outlined above. This system could enable access for adults while using caution in taking a step that may inadvertently put youth at increased risk.

It is unclear in the consultation document how a mail-order system might be associated with the aforementioned increased risk to youth. It is feasible that this statement alludes to the perception of eCommerce as a weak mechanism to identify the age of a purchaser, in relative context to identity verification protocols utilized in storefront retail outlets that restrict the age of patrons, such as liquor stores or tobacco outlets.

If this is the case, the assumption is unfounded.

Identity verification in eCommerce is a critical pillar of any successful mail-order business utilizing a digital storefront. If a retailer such as was not effective in identifying its clients, it would expose itself to the cost of chargebacks, returned packages, and lack of credibility. These risks prompt and other eCommerce retailers to rely self-interestedly on a variety of software applications to validate identity before a package is ever sent.

Simply cross-referencing name, credit card, billing address, and Internet Protocol Address (a unique identifier of the device and location from which a digital transmission originates) enables near perfect validation of identity for users.

Online identity verification is accomplished by software applications such as TruliooLexisNexis, and ShipCompliant that cross-reference identity inquiries with user-inputted information such as name and address.

Trulioo, for example, finds additional points of verification such as electoral role, social insurance number, and online consumer data from credit card purchases. Every additional layer of user data reduces the margin of error for identity falsification. The outcome is a repeatable, scalable, and near-perfect ability for patrons of Trulioo to validate the identity of their users.

Trulioo advertises that they have successfully verified the identity of over 3 billion individuals, each leveraging more than 14 of the unique reference points. Their portfolio of clients spans financial services, payment solutions, insurance, healthcare, travel, and online communities. All of these industries act in self-interest to mitigate the risk of identity falsification or inaccuracy.

Birth dates are associated with credit cards, birth certificates, passports, driver’s licenses, and a host of other data points that applications like Trulioo can harvest information from. This software is so exact that user signup pages for marketplaces like have become decreasingly complex, better optimizing the user experience.

User-input information requests such as a driver’s licence number, passport number, or bank account information have become redundant thanks to identity verification software like this running underneath the sales platform.

In contrast, even with the evolving security features of an identity card like a British Columbia Driver’s License, the age verification protocol of an average liquor retailer in the province boils down to “Does the person in the picture look like the person attempting to purchase the age-restricted product, and is this identification card authentic?”

These are judgement calls that retail staff have to make hundreds of times per day in 30 seconds or less, creating an untraceable string of potential errors based on the fallibility of humans. Risk factors such as fatigue, eyesight, training, and repeatability compromise this objective in ways that are avoidable with software.

In short, the assumption that retail storefronts can verify age more accurately than mail-order is not accurate; this objective is achieved far more effectively with software than by humans alone.

Dan Sutton is the managing director of Tantalus Labs. Tweets@DSutton1986 Instagram: @tantaluslabs

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