Positive updates on CBD payment gateways: a high-risk spotlight –
Due to the recent shakeup in the US regarding CBD e-commerce merchant accounts and payment gateways thousands of hemp and CBD site owners are now finding themselves without a way to accept credit cards. Below we go over some of the top issues facing CBD site owners in terms of payments and discuss solutions as well.
CBD merchant accounts – still there after “The Big March Shutdown Notice”
At Tasker Payment Gateways, we’ve kept our ears to the ground for a while when it comes to the CBD and hemp oil industries. The processors and gateway providers are very busy. Some have already stopped accepting new website owners as clients; others have but minimum processing requirements in place. We are happy to report that we are still having fantastic success when recommending appropriate, affordable, payment gateways to CBD site owners – even for startups.
CBD e-commerce sites need specially set up payment gateways with credit card processing that’s underwritten for CBD, and the payment gateway needs to work with a site owner’s shopping cart of choice.
You may have been turned down by your shopping cart’s out of the box payment processor, for example, Shopify Payments, for being high-risk – but why is CBD high-risk? CBD and hemp oil accounts are considered high-risk due mainly to regulatory concerns and a fear of chargebacks on the part of the merchant account providers.
Because processing can be hard to come by, many site owners try, at first, to use a low-risk payment gateway like PayPal for CBD sales. Taking this shortcut is not a good idea – if the payment gateway is not correct for the CBD industry, website owners often suffer from held funds and shut down payment gateways – not a great way to build a CBD business. Luckily, we have the experience to help guide website owners in the right direction.
Plenty of CBD merchants contact us these days for CBD payment gateway and payment processing recommendations. To help with that, we thought we’d create a short overview of things to keep in mind when you’re about to set up an online CBD shop.
Are you ready to start your online CBD business but need high-risk payment gateway recommendations for credit card processing? Contact us today by using the short form at the end of this article.
CBD payment gateways in Canada unaffected by the industry turmoil
One item we want to make clear: Canada was by and large not impacted by the large CBD account terminations that affected US-based CBD website owners this year. We are finding it very easy to assist Canadian website owners with payment gateways and merchant account recommendations. Unlike US CBD merchants, the Canadian site owners we work with are still able to use the same processors this year as they were last year.
Processor specifics and requirements for high-risk online sales
As we explained above, any website selling CBD products is selling what’s called a high-risk product. Similar to, for example, FFL to FFL transactions, tactical products, or vape sales, you’ll need to meet specific criteria before accepting credit card payments. The reason for this is that your industry undergoes a significant degree of legal scrutiny and regulation. This carries with it a higher risk both to your business and to merchant account providers. These elements apply to the hemp industry and CBD market as well.
Below are a few elements you need to keep in mind when setting up your online CBD store.
Specifics and requirements for online CBD and hemp oil sales
Be careful what products you sell through your credit card processor. While there are card processors that work for CBD oil and hemp-based products, you need to be careful to read the fine print. At the same time, you need to be sure that your products cannot be interpreted or defined as a marijuana product. This means that you need to check that the products you intend to sell are allowed by the Controlled Substances Act, administered by the United States Department of Justice, Drug Enforcement Administration. Our trusted, independent agents can go over the processor agreements with you in detail – just contact us to get started.
Only sell hemp or CBD products through your CBD processor account. You want to make sure that you only process products that fall within the specific criteria outlined when you applied for to the card processor. Many will outline that only a particular product type is allowed to be processed through it. In other words, if you sell pipes, glassware, or other paraphernalia, you should use a separate payment gateway or credit card processor for these different product types – likely on a different URL. Some products, like vape and CBD, can be combined, but it depends on your business. Again, contact us with any questions.
Make sure your products meet legal and processor requirements. As a high-risk merchant selling products with many regulations and legal scrutiny, your products must meet all relevant requirements. This includes that your CBD products have less than 0.3 percent tetrahydrocannabinol (THC) by dry-weight. Your products also need to be in line with all local, state, and federal regulations. You need to consult a qualified attorney before selling CBD online – we are not attorneys, and you should not consider anything on this page to be legal advice.
Your distributor needs to be licensed and should be local. It’s important for you to know that you should only buy cannabidiol/CBD from distributors licensed within the state you’re operating from. Additionally, most processors do not allow you to ship or deliver your products outside of the United States.
Get legal counsel when starting your online CBD shop
It’s worth stating again: we are not lawyers. While we do have experience helping many CBD and hemp oil merchants sell online, we are not legal experts. You should always seek legal counsel when setting up a business that sells products that are highly and carefully regulated. If you need assistance getting in touch with someone, we might be able to help. However, our advice above should not be considered legal advice.
Using a qualified attorney who specializes in your industry and e-commerce law – before you start – is always a good idea. If you need a recommendation, we are happy to help when we can. Reach out anytime.
CBD payment solutions through major e-commerce brands
Recently, we’ve become very familiar with a few CBD payment solutions that work with all major web platforms, including BigCommerce and Shopify. However, identifying the right solution and combination of payment gateway, shopping cart, and site-builder is no cakewalk. In other words, please don’t hesitate to get in touch. You don’t have to sift through endless terms and conditions before getting an overview of your options. Our trusted, independent agents are always available for a free, no-commitment talk about your business and the alternatives you have at your disposal. Get in touch with us for a simple chat about how you can start accepting payments for your CBD e-commerce site today.