Steps to Get Your CBD Oil Merchant Account
March 2, 2023 | High Risk Merchant Account | Dustin
How to get a merchant account for CBD oil?
If you are trying to get a merchant account for a CBD Oil business, you’ll need to look for alternative forms of payment processing. CBD is a high risk industry in the financial sphere. This means your company requires a specific type of merchant account that allows for increased liability from banks. Credit card processing in a business with age and legal regulations is different than instant-approval merchant accounts. This is because major companies want steady and safe transactions from trusted businesses.
If you sign up for standard payment processing with a major company like PayPal or Stripe, you’ll likely be shut-down after a few weeks. Be sure your operating within the Terms and Conditions you agree to with the processor you pick. For example, PayPal’s CBD Policy doesn’t allow for certain types of high risk businesses including a merchant account for CBD oil.
CBD Merchant Service
CBD merchant services include credit card processing, chargeback protection, and a general allowance for selling certain products on your website. These services are essential for companies who want to sell a variety of CBD products and have a sustainable way to process payments through their ecommerce store.
How Does CBD Payment Processing Work?
CBD payment processing has to conform to certain regulations set by the FDA such as The Farm Bill Act. Percentages of THC in the CBD products have to fall within certain paramters. Also the way the CBD oil is cultivated and extracted falls into a grey area of federal and state laws. This makes the sale of CBD oil and products high risk for acquiring banks looking to set up a CBD oil merchant account for retailers.
With the recent wave of cannabis legalization and decriminalization for recreational and medical use in the United States, entrepreneurs and corporations alike have been flocking to get on the ground floor of this booming industry. Possession laws for cannabis vary from state to state, and the natural marijuana derivative cannabidiol, or CBD, faces more lax regulations due to its more medicinal focused uses.
Although the CBD industry is highly regulated, the CBD market is expected to boom to $2.1 billion, a 700% increase, by 2020. Today, there are hundreds, if not thousands, of hemp and CBD venders in the market. But there is still plenty of room for forward thinking entrepreneurs to get in on the business. But before you make the moves to dive into this lucrative industry, make sure you understand why it is important to set up a high risk CBD oil merchant account for your debit and credit card processing needs.
CBD Oil Basics and How to Acquire a CBD Oil Merchant Account
For the uninitiated, CBD oil differs from marijuana in a few ways. For one, CBD is a cannabinoid that is part of the natural makeup of the cannabis plant. It has antibacterial, neuroprotective, and pain relief properties and has also been shown to help reduce anxiety, prevent seizures, and even lower blood pressure. CBD on its own is not a psychoactive chemical meaning it will not cause the intoxicating effects of consuming pure marijuana which contains illegal amounts of tetrahydrocannabinol (THC) along with various other cannabinoids. CBD oil on the market can be sold as a CBD isolate (just CBD) or a full spectrum oil that contains CBD, other cannabinoids, and minute amounts of THC (by law, less than 0.3% of bulk weight).
As mentioned above, laws and regulations around the production, sale, and consumption of CBD in the US varies by state to state, but on a federal level, CBD is classified as a schedule I drug under the Controlled Substances Act. Though CBD is legal in many states, the classification means federal law enforcement agencies can shut down CBD producers and press charges against consumers on a whim. For this reason, the CBD oil industry is considered high risk by acquiring banks that supply businesses with debit and credit payment processing services.
Take The Steps to Set Up Your CBD Oil Merchant Account
If you don’t use payment processing solutions that accept high risk accounts, like we do here at PayKings, funds in your CBD oil merchant account can be frozen or shut down completely after the bank’s underwriting process has found the industry as high risk. Before you set up your CBD oil business, here are a few steps you can take to get your high risk CBD oil merchant account up and running.
- Number one, you want to research your local hemp cultivation laws, or if your importing raw product, transit laws, and everything to make sure you’re on the right side of state laws.
- The next step is easy, because by reading this blog post on the PayKings blog, you’re in the right place to start looking for debit and credit payment processing solutions.
- Click here to apply for a free quote for your CBD oil merchant account. The experts at PayKings have relationships with 20+ acquiring banks. We will work with you to get the best merchant account rate on the market.
Where they decline, we approve. Get started and apply for a CBD oil merchant account with PayKings!
March 2, 2023 | High Risk Merchant Account | Dustin