CBD Payment Processor & Payment Approaches – Best Ways to Receive CBD Money Seamlessly
CBD payment processors can facilitate you receive CBD purchase dollars. It’s by accepting digital payment, credit cards, and debit cards, etc. Also, it allows you to acquire and serve customers who prefer these common types of transactions. What’s more, a CBD CMS also enables sellers to provide payment methods to CBD customers through integrating alternative payment gateways.
So in this article, I would walk you through the main CMS and payment gateway’s policy towards CBD business. You can learn what available options and approaches you can refer to for smoothies. It’s seamlessly receiving payment from CBD customers.
Stripe and PayPal Payment Processor Not Support Any CBD Products in any countries
It currently doesn’t support the sale of CBD products. Whatever CMS platforms are such as Shopify, Woocommerce, Bigcommerce you’re using. Basically, the prohibited products include any products with CBD or THC in them. They can be CBD-containing oil or tincture, topical cannabis-based products, or services like massages that include cannabis-based products.
Stripe categorizes CBD payment as a restricted business, and it does not allow almost all types of industry to process due to various concerns. These concerns are often because of regulations and legalization. Moreover, restricted business categories exist with many payment gateway service providers, except for Stripe.
I am guessing you want to test its bottom line and sell CBD on the website and receive the payment via Stripe. You may have breached the terms and conditions you agreed to when you opened your account. In this case, your account might become a high-risk merchant account. Stripe especially pays attention to this high-risk merchant account, when it comes to their payment processing. Thus, it’s only a matter of time before you could get your merchant account dropped.
The company states that products containing any CBD or Cannabidiol being sold are not allowed using the platform. PayPal does not accept or facilitate any CBD payments. 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.
That said, some corporations are still using PayPal. It is risky, and from my point of view, it’s still by no means a good solution. Similar to the bank transfer method, the solution is not allowing the customer to make payment directly through the website using PayPal. It integrates with Shopify, Woocommerce, or Magento.
Instead, you can set up manually handling payment while activating email automation. It’s by sending your PayPal account to the customer. The customer will need to send the payment manually. It’s similar to the bank transfer method. You would need to ask the customer to add a note of their order ID.
Shopify, Woocommerce, Magento CBD Payment and Support Limitation
The Payment is not available for any ingestible or topical CBD products, although Shopify has partnered with several integrated third-party payment gateways and alternative payment options. They do support the sale of hemp and/or hemp-derived CBD products.
Merchants, who want to sell CBD on Shopify out of the United States, must be licensed cannabis sellers and are required to use Shopify Plus. While merchants confirm that they understand the requirements for selling hemp and/or hemp-derived CBD products on Shopify. They will comply with those requirements.
WooCommerce is an open-source platform, so it doesn’t hold any restrictions on what can be sold on your WooCommerce store. How you choose to build it.
In fact, there are some limitations in the CBD business. First things first, WooCommerce’s parent company Automatic doesn’t officially support CBD-related products due to some regulations. It means that Woocommerce.com services Jetpack, related plugins, and employees are unable to support a WooCommerce store selling CBD.
Secondly, CBD sellers can not sell CBD products using wordpress.com. It’s because it’s a hosted solution and is supported by the company Automattic. Lastly, due to restrictions from our payment service provider, and their financial service providers, CBD selling is not allowed to use WooCommerce Payments.
Having said that, fortunately, similar to Shopify, WooCommerce partners with a third-party payment gateway. It’s such as Square to make it possible to sell CBD via WooCommerce
Magento supports the marijuana lifestyle brand or cannabis distribution website. This platform is suited for large e-commerce cannabis websites that sell a lot of items with lots of options. It’s by no means an easy or cheap platform to build a website. It’s because it is the most complex platform, compared with Shopify, and WooCommerce. You will need to hire a professional developer to get your site live.
That said, it means that you can use all software, logistic platforms, payment gateway, etc. Those support CBD selling. The space is many openers and bigger than the other two CMS. It’s because there are no existing structures and ceilings to limit your business execution strategy.
Take Shopify CMS and CBD Payment Processor Alternative Options in Hong Kong for the example
Shopify allows CBD sellings, although Shopify payment doesn’t facilitate the checkout and payment processing. Basically, you can look around and check the different third-party payment gateway, alternative payment options integrated with Shopify, to compare the policy and fees and select all proper ones.
PayMe, FPS, Bank Transfer, Cash on delivery (COD)
Shopify allows sellers to set up manual payment methods. Basically, these methods mean that payments are processed outside your online store. When a customer makes a manual payment, you need to approve their order before fulfilling it.
In Hong Kong, the popular peer-to-peer digital payment or bank payment transfer methods include PayMe, FPS, bank transfer. Similar to the PayPal workaround method set up, you would send the customer the QR code, or bank account, and the customer needs to handle it manually and add a note telling you the order ID. For COD, of course, a delivery vendor like SF would help collect the money when giving the product to the customer.
The pros of this approach should be avoiding any restricted policy and banning issues because it’s not being processed on the web automatically via the payment gateway. However, the cons must be the time consuming to handle fulfillment one by one, and you can imagine when along with the order volume going up, how nightmare it can be.
PayDollar – Visa, Master, AE, China Union Pay, JCB
Credit Cards are very common and customers already get used to paying by credit cards in Hong Kong. And PayDollar can be an option to provide your customers paying by credit cards in Hong Kong, while the payment gateway supports CBD payments. The fees vary which is similar to other payment gateways. If you are interested, call their business development representative.
Atome – Buy Now, Pay Later
Atome supports CBD selling. To end consumers, Atome is a payment instalment app, that allows them to pay the order split into 3 times, instead of paying the full amount in a time. What’s more, merchants can receive a full amount within 3 working days, and activate this payment method for specific SKUs that are more than the minimum. order value. In a way, it’s a great option to increase AOV from the online store.
Atome charges transaction processing fees. It varies depending on the merchant store requirements and the customer payment card type. The fee range is between 1% to 3.95%, which is reasonable compared with other payment gateways.
Tesla has already been accepting cryptocurrencies from car buyers. The good news is the payment gateway like CoinPayments supporting CBD payments.
CoinPayments support 70+ cryptocurrencies worldwide, and it can integrate with Shopify that you can select in the Shopify payment section, without any technical work. The fees of withdrawal vary as well depending on the coins, however, the cons are the coin market value might be changing ongoing, so in a way, it is hard to precisely calculate the total cash number that can be converted from the coins.
China Payment – Alipay and WeChat Pay
Hong Kong residents are also using Alipay and WeChat Pay, and the popular momentum is going up. If you want to please these two payment preference customers, China Payment is a choice for you, which can support CBD payment.
Except for the transaction processing fees, China payments is running a subscription model that charges merchants a monthly fee, and the fee varies based on how many payment methods you adopt. From my point of view, you can start with a manual approach as well as PayMe, by sending the AliPay or WeChat Pay QR code. If the volume of using Wechat Pay or AliPay is to be a certain amount, you can consider activating these automatic payment features, for the purpose to save dollars in the early stage.
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How To Find CBD Payment Processing Services [+ CBD Credit Card Processors for Ecommerce Shops]
CBD is arguably one of the fastest-growing markets ever to come out of the woodwork — or, to be specific — soil.
This cannabinoid is a highly sought after derivative of the cannabis plant and its abbreviated version — CBD — is short for ‘cannabidiol’.
By 2022, Statista predicts that the U.S. CBD market is on-track to earn $1.8 billion in legal sales.
Elsewhere around the world, CBD markets are also cropping up. Globally, the CBD industry looks set to earn $22,07,162.54 million by 2026, growing at a 58% CAGR between 2019 and 2026.
As the consumer demographic grows, so do the opportunities for sellers. Making a profit by selling CBD oil online is an appealing choice for business owners who don’t want to run the overhead costs associated with a brick-and-mortar store. Plus, according to recent reports, 1.6 billion people use their smartphone to shop online — indicating the power of running an ecommerce store.
However, as a Schedule I substance that has not yet been legalized at the federal level, suppliers are limited in regards to CBD payment options. After all, banks and financial institutions run the risk of federal intervention if their clients are accepting payments for cannabis-derived products like CBD.
The good news is that some payment processing companies are willing to take the risk, thus granting online business owners swift entry into the evolving space.
Setting up a CBD merchant account is essential because if you cannot accept payments, you won’t be able to ship CBD orders. As a result, you cannot build a list of positive customer testimonials, make a profit, keep the business running… (you can see where this is going).
A payment processor will facilitate all transactions and provide online CBD stores with a software platform from which they can monitor analytics for sales, shipments, stock, etc.
In this piece, we’ll deep-dive into what CBD is, how you can sell it online, and the role that payment processing will play in your success.
A recent timeline of CBD legalization and legislation
Cannabidiol — otherwise known as CBD — is a phytocannabinoid that was initially discovered in 1940. The compound is one of 113 cannabinoids to be discovered so far and it accounts for 30% of the plant’s extract.
1990s: Medical marijuana on the rise
The nation began to take a more progressive stance on cannabis, as marijuana became legalized in Oregon, Alaska, Washington, Maine, Hawaii, Nevada, and Colorado in the late 90s.
2004: Charlotte’s Web
Charlotte Figi, a young girl reduced her 300 seizures a week and became almost seizure-free, thanks to CBD oil. This sparked the famous CBD business “Charlotte’s Web” and gave CBD a spotlight in the medical field.
2012 and onwards: Recreational cannabis becomes legal
In 2012, Colorado and Washington became the first states to fully legalize marijuana in a recreational view.
2018: Farm Bill is passed
In 2018, President Trump signed in the Farm Bill, which legalized the use of industrial hemp, opening up the floodgates for CBD sales.
Present day: A plethora of CBD
Ever since CBD’s full legalization in 2018, CBD has become hugely popular throughout the United States. Many ecommerce shops have begun selling CBD to meet demands.
Is CBD legal?
Hemp — a non-psychotropic species of the Cannabis Sativa L. family bed — is a plant that CBD can be derived from. While cannabis remains illegal at the federal level, hemp underwent reclassification following the signing of the 2018 Farm Bill, which eliminated it from the Department of Justice and Drug Enforcement Agency’s Controlled Substance Schedules.
When derived from hemp, CBD products generally contain less than 0.3% THC. Since THC (tetrahydrocannabinol) is a psychoactive substance that cannabis can yield in large quantities, anything that exceeds the threshold is deemed to be illegal.
Despite a lack of research, efforts are being made to confirm CBD’s therapeutic efficacy in the medical field. Between 2014 and 2018, $16 million had been funneled into research initiatives by the National Institutes of Health (NIH). The funding was designated for a number of small trials into CBD’s effects on anxiety, addiction, depression, opioid addiction, and other various health issues.
What are high-risk payment processors?
Cannabis-derived products like CBD are becoming more widely accepted across the globe. Although the stigma is dissipating, all CBD products — no matter which plant they have been derived from — are associated as “high-risk.” This means that financial institutions and commonly used payment processors, such as PayPal, do not accept CBD transactions.
As a result, many CBD brands and online store owners have been left scrambling for payment processing solutions that ensure they don’t miss out on the “Green Rush.” Examples of some other high-risk industries that require gateway payment systems include adult products/services, Bitcoin trading, e-cigarettes, online gaming/dating, pharmaceuticals, travel services, telemarketing, and vape companies.
How can CBD payment processing benefit my business?
Take a moment to evaluate which products and services are vital for the success of your business. Chances are, your mind will go straight to thoughts about customer service and payment processing; and, let’s face it, you can’t have one without the other.
If you really want to hit your sales target in 2020 — without risking delays and difficulties in conducting CBD transactions — find out why your business needs CBD payment processing:
1. CBD payment processors accept credit cards and debit cards
Paying by credit or debit card is one of the most popular ways to carry out online transactions. According to a survey of over 2,000 people that was carried out by Harris Poll in August 2017, 44% of people preferred paying by debit card. If you can’t provide this, chances are your customers will seek out alternative suppliers.
CBD payment processing will aid you in attracting and retaining customers, since processors accept these favored types of transactions.
2. Customers have access to alternative payment options
In addition to providing credit and debit card payment processing, a sophisticated system will grant your customers the freedom to buy CBD products with a variety of alternative payment gateway options, such as gift cards, prepaid cards, bank transfers, and even buy-now-pay-later options.
3. Easy payment integration with your existing systems
CBD payment processing systems can be integrated into your existing ecommerce store. Better yet, payments can be merged with other payments included in your workflow, such as accounting, billing, customer relationship management (CRM), and more.
4. Improved customer service
The great thing about CBD payment processing services is that 24/7 troubleshooting and customer service can be included in the bundle, so long as you select the right processor. A dependable provider will also be able to assist with data security and fraud protection, thus safeguarding your customers when they buy CBD products online.
5. Ideal for taking a business to new heights
If scaling your business is of importance to you (and why shouldn’t it be?) then you need to use CBD payment processing. Service providers will continuously update their software to ensure your online CBD store is operating at lightning-fast speeds.
A full-service CBD payment processor will also be able to tweak their programs, should any changes occur in the payment market.
6. Less chance of mistakes and discrepancies
You’ll have enough on your plate dealing with customer inquiries and introducing new CBD products to your ecommerce inventory — don’t risk the chances of having to deal with discrepancies, too. Forget about spending hours training staff to reconcile any accounting errors that may have arisen and, instead, rely on CBD payment processors.
Considerations for CBD payment processing
CBD products are being tightly regulated by the Food and Drug Association (FDA). Because of this, CBD is considered a high-risk category and, consequently, ecommerce store owners must adopt suitable payment options if they are to reap the rewards.
Even though the big banks might not be able to collaborate with you for CBD payment processing, there are a number of gateways that will enable you to carry out transactions just like low-risk companies do.
Nonetheless, a few considerations should be taken into account before choosing a service. For example, pay attention to the CBD payment processors that are compatible with your ecommerce site design. You should also be on the lookout for a company that offers point-of-sale (POS) availability, as this will reduce the in-office workload and administrative tasks required of your team if you have a physical store location.
Reasonable contracts are a must, as well as customer support. Don’t forget that you’ll need to take into account a number of fees that are mandatory in determining a payment processor, including statement fees, compliance/non-compliance fees, monthly/annual fees, and terminal fees.
It’s also important to remember that you may incur higher fees for credit card processing and debit card transactions.
Building a presence online with your CBD business depends on how well you can satisfy customers. Utilizing a CBD payment processor will ensure that high-risk merchant transactions can be dealt with securely, thus giving your customers the opportunity to browse and buy with ease. Until cannabis’ federal restrictions are lifted — it is currently a Schedule I substance — online CBD sellers will need to find a provider of high-risk transaction services.
Learn more about how BigCommerce supports CBD sellers here.
Get help shipping CBD products
Getting a secure payment processor is one piece of the complex CBD puzzle. Shipping and order fulfillment are as complex. Luckily, ShipBob is a third-party logistics (3PL) company that helps CBD business fulfill orders for US customers. We store CBD products, pack boxes, and ship orders as they are placed. We’ve helped over 100 CBD customers provide fast, affordable shipping.
“Our fulfillment is on autopilot. ShipBob saves us so much effort, and the opportunity cost savings has been substantial. ShipBob’s platform is easy to use and navigate, the interface is intuitive, and the analytics are very clearly laid out. Today, our health and wellness brand sells three CBD products in the United States.”
Yannick Crespo, Co-Founder & President of Pot d’Huile
If you want a professional CBD fulfillment company to handle CBD shipping for you, get in touch with ShipBob to learn more.