CBD industry has been on the rise in the recent past and the proportion is expected to rise in the near future. As more people turn to CBD for various applications from mainstream use or even medicinal needs including oils for consumption or even edible products, skincare products and wellness products business people are opening up to this market. However, one major problem that most CBD business people encounter is the issue of creating a good merchant account for the payment of transaction. In this blog, you will learn what is this CBD merchant account, why it is necessary, the difficulty of getting this account and how to select the right solution for CBD industry.
What is a CBD Merchant Account?
A CBD merchant account refers to a type of payment processing account that permits CBD companies to process their consumers’ credit and debit cards. CBD merchant accounts differ from the typical merchant accounts in that the latter is intended for the higher risk that CBD businesses present. As a result of the legal requirements peculiarities and the associated hazards connected to the sale of CBD, conventional banking institutions and payment providers tend to consider CBD-related companies high-risk ones. This makes a specialized merchant account to be important in the process of making payments.
Why is a CBD Merchant Account Important?
- Seamless Payment Processing:
Paying customers feel the need for paying through credit or debit card facilities. One downside of not having a merchant account is forfeiture of business.
- Legitimacy:
The easiest way to achieve credibility and trust with your customers is by having a merchant account.
- Scalability:
A good payment solution means that businesses can accommodate enhanced sale volumes as they scale up.
Challenges in Securing a CBD Merchant Account
- High-Risk Classification:
Chargebacks, CBD’s legal status, and a lack of consistent regulation from the federal government make banks and processors consider CBD businesses high risk.
- Regulatory Compliance:
It is important for CBD companies to adhere to the laws such as the Farm bill and or CBD products containing not more than 0.3%THC.
- Limited Payment Processors:
Most of the mainstream payment processors including PayPal and Stripe commonly limit CBD business.
Top Features to Look for in a CBD Merchant Account
CBD businesses are considered high risk because of issues of legal nature and regulatory environment. The CBD merchant account provider whose services are specialized on handling such businesses have a usual feel of some of the hurdles and can therefore provide a remedy. Choose the providers that can help you in a compliance aspect and make sure your company complies with all the needed regulations. importance in the same line with encryption. Chargebacks occur frequently in glorified industries and can jeopardize stability of an account.
Conclusion
CBD merchant account is not just a payment solution and service and it is now a key to the growth and trustworthiness of a business. Nevertheless, acquiring one may seem very herculean but when partnered with the right provider it becomes very easy. Consequently, you can attain compliance, transparency and scalability to achieve a payment processing solution that will help your CBD business thrive in this growing market.