CBD Friendly Payment Processors
9 July 2021
You know what absolutely sucks – walking to a store and finding out they don’t accept credit cards when all you have is a credit card. Now you have to go find how to convert your money to liquid, spendable cash. And let’s be honest, if the business is not worth the hassle, we all just find another store. That used to be the norm some years ago, but that’s changing, fortunately.
Now, there’s a new norm. While most businesses do accept credit cards, some CBD businesses get notified by their merchant account provider that they have been dropped. Well, back to square one.
None of this has to happen to you. None of this will happen to you if you have a good payment processor. And not just anyone now, but a CBD-friendly payment processor.
That said, today’s article will examine what CBD payment processors are, why finding one is difficult today, common ones you can use, and, of course, tips on finding an excellent CBD-friendly payment processor for yourself.
What Are CBD Friendly Payment Processors?
Before we dive into CBD payment processors, it makes sense to understand what payment processors are in the first place.
A payment processor is a transactor appointed by the merchant that manages the credit card transaction process by serving as a mediator between the merchant and the financial institutions involved. In simpler terms, payment processors handle a company’s transactions so that customers can buy products from various channels, such as credit and debit cards.
Now that we have that out of the way, what are CBD payment processors? Simple – they are payment processors that accept businesses selling CBD products. It seems so simple on paper, but it isn’t even remotely close to being this simple in reality.
How do we mean? You’ll see.
Why Is Finding CBD-friendly Payment Processors Difficult?
For a long time, the hemp and marijuana industry in the United States was regarded as a no-go area for businesses and investors, primarily because of the tough restrictions the government put on it. However, the 2018 Farm Bill came and essentially removed hemp-based products, of which CBD is part, from the Schedule 1 list of controlled substances.
This was supposed to be the calvary for the CBD industry. And, to a large extent, it was. There’s a reason why the market is expected to reach $22 billion in a few years. But many banks and financial institutions were still skeptical about this industry and acted as such.
In fact, not only banks were skeptical of the CBD industry. Many investors, even to date, found it difficult to invest in CBD because of the legal gray area. It doesn’t help that virtually all social media channels are against sponsored CBD ads.
Aside from the legal aspect, there’s the fact that many CBD products are fake and substandard. It becomes difficult for the quality ones to thrive when there are bad apples. We just wish those apples fall very far from the tree!
Banks and other financial institutions usually term businesses like this “high-risk,” which, as you can imagine, means just that – high risk. This stems from the industry being relatively new and many scammers trying to cash out fast with charge-backs and other payment-related frauds.
Summarily, all of these have contributed to the difficulty in finding and choosing a suitable CBD-friendly payment processor for CBD businesses. The good news, though, is that they exist. And there are some outstanding ones out there, which we will duly consider.
Tips on Finding CBD Friendly Payment Processor
Many CBD businesses and companies’ mistake is just jumping at the first CBD friendly payment processor that comes their way. That’s not ideal at all. Many of these processors aren’t actually CBD-friendly, and their relationship with the merchants usually ends in turmoil.
For this reason, business owners should look out for certain factors in CBD payment processors to ensure that they are suitable for them. Below are a few of those factors and tips to look out for when shopping for a CBD friendly payment processor:
1. Comfortability with High-Risk Transactions
Let’s not deceive ourselves; the CBD industry is not the most risk-free industry. For real, there are tons of bad and substandard products, businesses, suppliers, and on. The relatively young age of the industry makes it perfect for frauds to exploit the weaknesses in businesses’ finances.
Payment processors are aware of this, and hence, stay away. But CBD-friendly payment processors understand the risks involved in dealing with CBD products and have embraced it. The willingness to take risks is one of the first factors to consider when finding a CBD friendly payment processor.
2. Availability of POS Services
Point-of-Sale services have become a must in businesses and stores today, and it’s not hard to see why. They save time and effort on the administrative front, ensuring the business owners can focus on more pressing issues.
If the CBD friendly payment processor has a POS integration system set up, it is even easier to manage transactions both on-site and online.
3. Low Prices
The CBD industry is relatively young. We cannot overemphasize that, which implies that many of the companies in this industry are also quite young. This becomes a critical factor when businesses have to pay for CBD payment processors.
Keep in mind that the more risk the CBD friendly payment processor is willing to take, the higher the cost. That makes sense. Business owners should also be prepared to pay several fees and charges, including monthly/annual fees, compliance fees, non-compliance fees, statement fees, among others. It is also noteworthy that credit transactions will cost more than debit transactions.
At the end of the day, businesses have to go for a company that can offer the best services at lower prices. Don’t get us wrong – we aren’t saying “go for the cheap option,” we are saying, “go for the more cost-effective option.”
4. Customer Support
Of course, this had to be here. We will go as far as saying this should be among the very first factors you consider before choosing a CBD friendly payment processor. If you’ve read up to this point, you will know CBD businesses are quite risky. As such, owners have to be prepared for anything, including issues with the processor and customers.
In such cases, good customer support will be of huge benefit. Ensure to speak with the CBD friendly payment processor about its method of handling and settling merchant and customer issues. Don’t proceed if you’re not entirely sure.
5. eCommerce Integration
Some CBD payment processors will require you to start a new platform to integrate the payment processor. This is basically asking you to bin what you already have and come over to what they are giving you. It’s disrespectful to the effort and time you have put into building a brand your customers have gotten used to and come to love.
CBD-friendly payment processors won’t do that. Rather, they would offer the opportunity for smooth eCommerce integration on your existing platform.
CBD-Friendly Payment Processors
Now, to the moment of truth – a list of the best CBD-friendly payment processors. We curated this list, taking into consideration all of the factors listed above.
If you’re familiar with CBD payment processors, the chances are high that you’ve heard of Square. Right now, it is arguably the best CBD friendly payment processor available for businesses and companies.
Square’s operations kicked into effect in 2019, and they have only gone upwards since then. The company isn’t the most high-risk you’ll get, but their pricing options are an absolute steal. The company is transparent with its pricing too, and that’s always a good sign when companies are willing to display all of these, as it means easier budgeting for merchants.
Aside from the fact that account holders don’t have to pay monthly fees, the processing hardware is affordable too. If you’re a particularly keen reader, you will have figured that Square is perfect for smaller and just-starting CBD companies – and you’re right.
Even though big and established companies can still use Square, smaller companies will benefit significantly more from this CBD-friendly payment processor.
2. SMB Global
If Square is perfect for small businesses and start-ups, SMB Global is the perfect CBD friendly payment processor for bigger, high-risk companies. This is easily evident by them charging $50,000 monthly for offshore merchant accounts. While this looks a little much on paper (okay, it’s quite much), it is worth every penny.
And SMB Global will not mind working with you if your business has good financial history, even if you don’t have the $50k to deposit. Speaking of offshore merchant accounts, SMB Global is one of the few CBD-friendly payment processors that offer this at a superb level.
Their pricing options are also great and is only matched by their wonderful customer service. For a payment processor this high-risk, the security has to be state-of-the-art, and it is. Your funds and transactions are secure with SMB Global.
Still on the subject of high-risk CBD-friendly payment processors, we present to you PayKings. The name tells you all you need to know about this CBD friendly payment processor – it oozes royal class. PayKings has a very valid claim to being the best in the CBD industry. Yes, they’re that good.
eCommerce integration on PayKings is fabulous and as seamless as you can hope for. The company is also very affordable, considering the quality of services they offer. The quality reflects in the speed of transactions on this platform.
Merchants with several bank accounts also have little to worry about, as this CBD-friendly payment processor will allow merchants to work on more than 20 banks.
In terms of age and experience, few payment processors can compete with PaymentCloud. They’ve been around for more than a decade and now accept CBD businesses. This company is also a high-risk provider.
Their pricing is also astonishingly low for a high-risk provider. They don’t charge a penny for application or setting up an account. PaymentCloud has personalized customer support. That is always a win. And the customer support is 24/7, too. Double-win!
This CBD-friendly payment processor is compatible with lots of third-party online shopping carts, increasing opportunities for account holders.
5. Viva Wallet
If your CBD company is based in the European market, we have just the payment processor for you. The range of payment options available on Viva Wallet is a huge plus.
Then their customer service. Trust us when we say you will find none better than Viva Wallet. The speed and effectiveness of responses are five-star.
Account-holders can track all payments and easily make transfers. Their fees are also on the low side. All in all, a great CBD friendly payment processor.
Choosing from The Lot
We have listed five of the best payment processors in the industry, but how do you choose the best for you? The thing is, there’s no straightforward answer to that question.
For one, you need to consider the risk the CBD company is willing to take. If your business is just starting up and relatively young, you should definitely go for cheaper, low-risk options. On the other hand, more established and larger businesses may want to consider high-risk options.
Then be sure of what you want. Is it an offshore merchant account? Is it a low-risk account? Just make sure you’re looking in the direction of what your business needs.
Getting a CBD friendly payment processor is not enough; you need a CBD-friendly payment account. One that will cater to all your CBD transaction needs, all while doing it at a top-notch level. We have made a shortlist of some of the very best in the industry – Square, SMB Global, PayKings, PaymentCloud, and Viva Wallet. Choose one that best suits your company’s needs, and you’re ready to go!
If you like what you’ve read, there are several more brilliant articles on Digital Octane that will help you take your CBD brand to the next level.
We’ll be waiting for you!