The CBD industry has certainly seen a surge in development and popularity over the past couple of years. With this always comes scrutiny and regulations by regulatory bodies and the financial sector. Banks and processors are often hesitant to support CBD products. First let’s discuss what CBD is all about. Cannabidiol or CBD is one of the a hundred plus cannaninoids that are present in cannabis plants. CBD can be used for a multitude of ailments such as pain, anxiety, insomnia, and movement disorders. People ingest CBD is several different ways including inhalation, sublingual, and even in a lotion or salve. A common misconception is that CBD is that it is the same as its cannabinoid cousin, THC. THC is the most psychoactive cannabinoid in cannabis. Most CBD products usually contain less than 0.3% THC, which is the threshold for most credit card merchant account providers to support it.
In the US, the first CBD based drug, Epidiolex has been approved by the Food and Drug Administration. This drug was developed as a treatment for epilepsy. Unfortunately, the drug has a litany of side effects that make using CBD is its raw form more desirable. While CBD is not a scheduled drug and is legal in all 50 states, Epidiolex is listed a schedule 5. Even with CBD being legal in the US, it still doesn’t stop banks and processors from regulating when they will support it. We recently saw the mainstream processor, Elavon and their partnership with US Bank support CBD products for about 6 months, until they abruptly stopped and left many CBD merchants without payment processing.
Performance Card Service understands the need for quality and stable processing solutions for CBD and work closely with merchants to ensure they find a good fit. We highly recommend utilizing our eCheck service in tandem with a credit card processor. Echeck is not governed by Visa/Mastercard so the chances of getting shut down are minimized. We have found that eCheck processing is a great alternative to credit card and has actually kept many of our clients in business when they experience issues with credit card processing. We also have a handful of processors and banks that will approve CBD merchants for credit card processing based on their profiles. Startup and smaller volume CBD merchants may find that pricing is higher and approvals are not as easy, but we can still ensure placement with the best options available. Most established CBD merchants will usually find the approval process easier and more cost-effective options available.
We hope that over the coming years CBD becomes more mainstream and is more widely supported by all banks and processors. Until then, you can count on Performance Card Service to guide you in your search for suitable CBD processing options. Please contact us today for a free consultation to see how we can help you get setup to take both eCheck and credit card payments for your CBD products.