Merchants selling CBD need to establish high risk payment processing solution. Let PayKings establish your high risk merchant account today! Buy CBD, Delta-8 THC, THCO, and more from Diamond. Top-quality hemp products on sale now including vape carts, edibles, gummies and the best Delta-8 products. Online trading and dropshipping have evolved to a point where almost anyone can start an online business from home. CBD products have become a popular item to
How Can Payment Processing Impact CBD Merchants?
Traditional payment processors can have a significant impact on CBD merchants. Processors like PayPal, Stripe, and Square are big names in the processing industry that offer traditional services. These services are fine for low risk industries. However, when a business becomes more complex, a CBD processor becomes the best solution.
PayPal CBD and Policy Violations
Oftentimes, CBD merchants don’t know this when establishing payment processing. When CBD merchants use traditional processing, they put their entire business at risk. Traditional processors typically ban the sale of CBD. Violating this policy can result in a merchant’s account being frozen. Merchants are left without access to their business and any funds in their merchant account. This is an urgent problem for a merchant to face.
Keep your CBD merchant account protected and know the policies of traditional payment processors.
Don’t Get Dropped By PayPal – Get A CBD Merchant Account
Selling CBD classifies a merchant as a high risk. This is due to the advanced regulation and specialization that high risk industries require. CBD merchants operate in an industry where regulation is continuously changing. Since the sale of CBD was legalized in 2018, a lot of factors continue to evolve. Due to this, the sale of CBD becomes a higher risk than the average product on the market. Only a high risk payment processor can safely and effectively process payments for high risk merchants.
PayPal’s CBD Policies
PayPal CBD policy is pretty straightforward. As one of the earliest payment processors that changed eCommerce, they choose to avoid accounts that are high risk. PayPal makes it very easy for merchants to sign up and begin accepting payments right away. However, PayPal only caters toward low risk industries. A low risk industry does not experience high chargeback volumes. High chargeback volumes are typically associated with a high risk business. If PayPal detects more elevated than normal rates, a merchant’s account and all payment processing functions will be suspended until a further review is completed.
This process could take weeks due to the size of PayPal’s platform. Since PayPal does not allow high risk industries to use their platform, CBD merchants are out of luck. On PayPal’s policy page, it states that products containing Cannabidiol may not be sold using the platform. PayPal does not accept or facilitate any CBD payments. This is because the regulation on the sale of CBD products is constantly changing. So, PayPal does not want to worry about being in regulatory compliance by banning this sale. The same can be said for other high risk industries. PayPal’s policy states that any business deemed as high risk will not be supported on their platform.
Stripe’s CBD Policies
The Stripe CBD policy has similar restrictions to other traditional payment processors. Their popularity in traditional processing often confuses high risk merchants. Many high risk merchants don’t even think twice when signing up for Stripe’s platform. But unfortunately, a merchant’s high risk business will likely be shut down once discovered on Stripe. Stripe’s policies state that high risk industries are restricted from using any aspect of the platform. Among those explicitly stated is any Cannabidiol product. Stripe’s CBD policy is zero tolerance. This means if a merchant is discovered selling CBD, they’re account could be frozen. Now, it is up to the merchant to establish a high risk merchant account to regain their business and funds. Once this is done, Stripe can release funds and deactivate your account.
Stripe uses machine learning through Radar that can evaluate each payment’s risk in real-time. Radar is a helpful tool for merchants and can even protect them from fraud. While on the other hand, it means that merchants using Stripe are continually being evaluated for risk. High purchase volumes or an increase in chargebacks can make merchants appear to be high risk to Stripe. Radar can automatically flag your merchant account for Stripe to review. This may come along with your account being temporarily frozen. However, if you are a high risk merchant, you know that your industry comes with abnormally high chargeback volumes. Stripe does not have expertise in high risk, nor do they want to. So, this is why high risk merchants cannot look to Stripe for long-term processing solutions.
Square’s CBD Policies
Recently, the Square CBD policy has changed. They launched an early-access CBD program for high risk merchants. The program is a limited access trial that allows merchants to sell CBD on Square’s platform. When CBD sales were legalized in 2018, Square felt that there platform needed to be opened up to this new market. So, Square processing has been made available for all types of CBD transactions. There is a CBD processing solution for in-person, online, in-app, and virtual terminal sales. Square CBD processing offers a clear price breakdown for each solution on their website.
Square is one of the first traditional platforms to delve into CBD processing. However, merchants must undergo intensive screening to make the cut. Square makes sure all products sold on their platform are under the THC threshold. Additionally, the Square early-access program is only a trial for the payment processing company.
High risk merchants seeking solutions through Square’s traditional payment processing platform are out of luck. The platform does not support high risk industries due to the specification and expertise needed. Without knowing this policy term, high risk merchants can get caught in a violation of terms. This results in the merchant account and funds freezing until a high risk account is established elsewhere. A full list of policy terms, prohibited goods, and restricted sales can be found on Square’s website .
Let PayKings Establish Your CBD Merchant Account
High risk merchants who establish payment processing via traditional platforms are sure to run into some trouble. PayPal, Stripe, or Square just can’t fit a high risk merchants needs. So as a high risk merchant, it is essential to understand payment processing in your industry. As a high risk merchant, there are plenty of reliable options out to choose from.
Allow PayKings to get your CBD merchant account started off the right way with a high risk solution. As experts in the CBD industry, PayKings knows what high risk merchants need. Let PayKings set your CBD business up for success with a high risk merchant account and a high risk payment processor. PayKings has numerous trusted card relationships so that you can accept more payments. Skip the stress and establish your high risk CBD merchant account today with PayKings. In as little as 48 hours, an experienced team member will walk you through the process of getting high risk processing established. At PayKings, we know there is no compromise for quality and security in the CBD industry. So call PayKings today to get your CBD merchant account on the right track.
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Does PayPal Allow CBD Sales?
Online trading and dropshipping have evolved to a point where almost anyone can start an online business from home. CBD products have become a popular item to buy online. Still, due to regional legislative differences, CBD is not always an easy industry to operate in and support is often lacking. PayPal is a popular online payment platform, but does PayPal allow CBD sales?
PayPal does not allow CBD sales at this time. PayPal’s policies prohibit the use of its payment system to accept money for the sale of CBD products. This is mainly due to CBD legislation varying considerably between different regions. But there are other payment options that do allow CBD sales.
Starting an online CBD business can be challenging, which is why it’s essential to know which services you can and cannot use. With the correct information and guidance, selling CBD online is easy to do. Let’s look at some reasons why PayPal’s payment platform does not allow CBD sales, and then find some other systems you can use to sell CBD products online.
Table of Contents
Why PayPal Doesn’t Allow CBD Sales
The possession, use, and sale of CBD oils and products have become legal in more and more locations worldwide. For example, in the United States, CBD is already fully legal in ten states, with varying degrees of legality in the other forty states. It is generally accepted that the safest bet for users is to order CBD products online and have them shipped.
The problem is that it’s not always easy to know how to comply with the legal requirements regarding CBD sales. On a single road trip in the US, for example, you may pass through areas where it’s completely legal to buy and sell CBD products. But very quickly, you may pass through a state that forbids CBD sales. That’s why selling CBD products can be challenging.
This problem accelerates when you consider worldwide online payment and sales platforms. Then the issue can become enormous. PayPal is active in over 200 countries, each with its own CBD legislation and policies. Some of these countries have multiple legislative areas with varying CBD regulations within their borders, which makes selling CBD products even more difficult. [ 1 ]
A company like PayPal cannot be expected to have appropriate policies for every region where its services are available. Until the sale of CBD products is more widely approved and legalized, it is simply not practical for PayPal to allow the use of its payment platform for CBD sales.
Another problem is that legislation regarding CBD is still in its infancy, and in some countries, regulations change rapidly. This makes some banks and financial institutions, like PayPal, view CBD as a “high risk” market, even though it’s obviously a lucrative industry. PayPal stays away from industries labeled as “high risk,” and this includes the CBD market.
A further unfortunate fact is that there’s still stigma surrounding CBD despite the fact that it is used in many commercial pharmaceuticals and its health benefits are widely publicized. Many people are still afraid to use CBD, which could cause them to view PayPal in a bad light if the payment platform were to start approving CBD sales on its platform.
Can Anything Be Done to Change PayPal’s Policies?
Public opinion may have some influence regarding CBD sales, and the PayPal Corporation welcomes user feedback on its policies. PayPal even created a web page where anyone can easily share opinions and ask questions about government regulations and public policies, which is available at https://publicpolicy.paypal-corp.com/about-us#contactus.
There are no guarantees, and as mentioned, it will take a lot of effort for PayPal to update its platform to allow CBD sales. But if the company has proof that there’s enough demand for CBD products, it may find that this market is lucrative enough to consider servicing. [ 2 ] [3 ]
What Alternatives Are There for Online CBD Sales?
Most experts recommend that CBD resellers register a CBD Merchant account to keep their businesses safe. These are accounts that allow you to accept credit card payments to sell CBD products. To register for a CBD Merchant Account, you simply find a payment platform that’s made provisions for CBD sales in its policies. Luckily, there are many to choose from!
USAePay has been around since the late ‘90s and specializes in high-risk merchant accounts, including businesses that sell CBD. When a company has been active for more than two decades, we can assume it knows its business, so this is in USAePay’s favor. This payment platform offers a gateway that’s compatible with most online retail platforms, and card machines are also available for those who want a walk-in shop.
NMI supports a wide range of payment options on a global scale. Users can make payments with credit cards, debit cards, or ACH from many different countries around the world. Transactions cost as little as $0.05 each, which is very affordable compared to some of the company’s competitors. NMI’s reporting systems are also exceptional and offer detailed information about transactions.
PayKings has earned a reputation in high-risk industries as a reliable and well-respected service provider. Specializing in high-risk merchant accounts, including CBD sales, PayKings has many advantages like direct links to more than twenty banks, rates as low as 2.49%, and exceptional integration with most platforms.
Many consider SMB Global the perfect merchant account provider for start-up businesses. Excellent customer service makes it easy for users to get started, and fair rates and contract terms mean you know what you’re getting and how much you’re paying. For larger businesses with offshore accounts, you have to process a minimum of $50,000, which could be a challenge for very young start-up businesses.
Easy Pay Direct
Easy Pay Direct has a longstanding reputation for being one of the biggest names in payment processing for low-risk industries, but its services are now also available for high-risk markets like CBD sales. There’s a setup and monthly account fee, though neither of these fees is exceptionally high, and Easy Pay Direct’s lower transaction fees make up for it. Generally, this is an excellent platform for CBD sales.
Founded in 2017, PayWize is a relatively new company, but it has grown to become one of the CBD industry’s most popular merchant payment processors. It already provides services to a considerable number of CBD oil merchants and medical cannabis dispensaries in the United States. It is compatible with many platforms and offers flat-rate pricing for processing CBD payments.
iPayTotal is ideal for the international market since, though the company is based in the United States, this service is available all around the globe. Unfortunately, a minimum weekly sales requirement of $1,500 could make iPayTotal less than ideal for very young startups, at least initially. But for the international market and businesses outside the US, it’s hard to beat iPayTotal’s offerings. [ 4 ] [5 ]
Inconsistent legislation is a problem that plagues the CBD industry. It means that you cannot use well-known and reliable platforms like PayPal to sell CBD products. And yet, the CBD industry is booming, and gradually more and more payment providers are opening up their services to the CBD market. Fortunately, there are platforms similar to PayPal that are ready and willing to facilitate CBD sales.