In the CBD and Hemp sector finding a processing company that will accept your processing business and retain your business is very difficult.
There are few situations more tragic than having a deluge of orders, and then having them fall through or cancelled because you are suddenly dropped by your Payment processor.
You want to work with the largest payment processors because they have the resources to deal with the risks associated with CBD. They also have the gravitas to deal with nervous credit card companies because the credit card companies want to keep their business with large payment processors because they bring them so much other business.
It is also expensive to properly vet CBD companies so most financial institution don’t have the funds to properly investigate CBD companies that if not properly checked out can bring many headaches to the processor down the line.
You can operate your business on a cash basis, but at point of sale it can get complicated and confusing if you use only cash. A large percentage of customers don’t like to use cash, and cash can be difficult because of the security and other infrastructure needed to move cash around.
Because CBD payment processing sits in such a gray legal area most financial institutions charge a premium for doing CBD payment processing.
Areas where they can charge extra because you use CBD are:
•They increase the costs for transaction fees
•They can require escrow or reserve accounts that demand a significant amount of reserve capital in the account. .
•And as stated before there is the constant risk, they will change their minds and shut you down.
•Some CBD organization’s use foreign banks to process their payments. Using foreign banks is risky because they are not under U.S. jurisdiction so if they act in bad faith and do something unsavory like keep your money your avenues for redress will be limited because they are foreign.