How to Secure a CBD Merchant Account for Your Business

This guide will walk you through the process of understanding, selecting, and applying for a CBD merchant account for your business.

The CBD industry is experiencing rapid growth, and many entrepreneurs are looking to capitalize on this lucrative market. One essential aspect of running a successful CBD business is securing the right CBD merchant account. This guide will walk you through the process of understanding, selecting, and applying for a CBD merchant account for your business.

Understanding CBD Merchant Accounts

A CBD merchant account is a type of bank account that enables businesses to accept and process electronic payments for CBD products. This includes credit cards, debit cards, and other forms of payments such as cryptocurrency, SEPA, and PIX. CBD merchant accounts are becoming increasingly important as the popularity of CBD products continues to grow. 

One of the main benefits of having a CBD merchant account is that it allows businesses to accept payments from customers all over the world. This is especially important for businesses that operate online, as it enables them to reach a wider audience and increase their customer base. Additionally, having a CBD merchant account can help businesses streamline their payment processing and reduce risk of fraud.

What Is a CBD Merchant Account?

A CBD merchant account is a specialized bank account specifically designed for businesses that sell CBD products. Due to the legal complexities and unique regulations surrounding the CBD industry, traditional banks and payment processors tend to avoid working with such businesses. This is because CBD is still considered a Schedule I drug at the federal level in the United States, despite being legal in many states. Of course, CBD sales aren’t limited to the U.S. Countries all across the globe face their own regulatory challenges when it comes to CBD merchant accounts.

However, there are now several specialized CBD merchant account providers that cater specifically to the needs of CBD businesses. These providers are able to navigate the legal and regulatory landscape surrounding CBD and provide businesses with a reliable and secure payment processing solution.

Why Is Securing a Merchant Account Important for Your CBD Business?

Securing a CBD merchant account for your business is crucial for several reasons. First, it enables your customers to make smooth and secure electronic transactions, thereby ensuring a seamless purchasing experience. This is especially important for businesses that operate online, as customers expect a fast and convenient checkout process.

Second, a reliable CBD merchant account helps build trust and credibility among your customers. When customers see that you have a secure and reliable payment processing solution in place, they are more likely to trust your business and make repeat purchases.

Finally, without a viable payment processing solution, your business will struggle to accept payments, thereby stunting its growth and profitability. By securing a CBD merchant account, you can ensure your business is able to accept a wide range of payment methods, and that your customers are able to make purchases easily and securely.

Challenges in Securing a CBD Merchant Account

There are several challenges that businesses face when trying to secure a CBD merchant account. These challenges stem from a combination of legal, regulatory, and banking-related issues. Let’s examine each of these challenges in more detail.

1) Legal and Regulatory Issues

One of the primary obstacles in securing a CBD merchant account is the complex legal landscape surrounding the CBD industry. CBD is derived from cannabis, but its legal status varies depending on the country, state, or even local jurisdiction. Though the 2018 Farm Bill legalized hemp and hemp-derived CBD at the federal level in the United States, some states and local jurisdictions have implemented their own regulations. CBD is no longer considered a narcotic substance under French, EU, or UK law, but that doesn’t mean that all CBD products are eligible for sale.

As a result, CBD merchant account providers may be extra cautious when working with businesses in this industry in order to avoid potential legal and regulatory pitfalls.

It is important for businesses in the CBD industry to stay up-to-date on the latest legal developments in their area, as well as any changes to regulations that may impact their ability to secure a merchant account.

2) High-Risk Industry Classification

Another significant challenge is the classification of the CBD industry as high-risk due to a variety of factors such as fluctuating legalities, potential chargebacks, and the high value of transactions. High-risk classification often means higher processing fees. Some CBD merchant account providers might be reluctant to work with businesses in the industry.

However, there are merchant account providers that specialize in high-risk industries, including CBD. These providers may be more willing to work with CBD businesses and offer more competitive rates.

3) Banking Restrictions

Many traditional banks and financial institutions are hesitant to work with CBD businesses because of the industry’s uncertain legal status and perceived risks. This can make it difficult for CBD companies to find a suitable banking partner willing to provide them with a CBD merchant account.

However, there are some banks and credit unions that are willing to work with CBD businesses. These institutions may have more experience with the industry and be better equipped to handle the unique challenges that come with providing banking services to CBD companies.

Additionally, some CBD businesses have turned to alternative banking solutions, such as online payment processors and e-wallets, to process transactions and manage their finances.

Choosing the Right CBD Merchant Account Provider

Securing a CBD merchant account can be a challenging process, but it is not impossible. By staying informed about the latest legal developments, working with a merchant account provider that specializes in high-risk industries, and exploring alternative banking solutions, businesses in the CBD industry can find a suitable banking partner that can help them grow and thrive.

Finding the right CBD merchant account provider is crucial for ensuring your business has the necessary tools to process payments securely and efficiently. Here, we will discuss the factors to consider when selecting a provider and some of the top CBD merchant account providers in the industry.

Factors to Consider

When evaluating potential CBD merchant account providers, consider the following factors: fees, customer support, ease of integration, types of payments accepted, and the provider’s reputation. It’s essential to compare the services and fees of different providers to find one that best meets your business requirements.

Additionally, look for a provider with expertise in the CBD industry, as they will be more familiar with the unique challenges and regulations your business faces.

Top CBD Merchant Account Providers

Some of the top CBD merchant account providers include:

  • PayDiverse
  • Square
  • PaymentCloud
  • Soar Payments
  • Vendo Services
  • Durango Merchant Services


Each of these providers offers tailored solutions for CBD businesses, and they understand the industry’s unique needs and challenges. Be sure to research each provider thoroughly and compare their services and fees before making a decision.

Preparing Your Business for a CBD Merchant Account Application

Before applying for a CBD merchant account, it’s crucial to prepare your business by ensuring compliance with industry regulations, creating a solid business plan, and establishing a robust online presence.

Ensuring Compliance with Industry Regulations

Compliance with all relevant industry regulations is vital when applying for a CBD merchant account. Maintain accurate records of your products’ origins, third-party lab results, and any certifications required in your jurisdiction. Be prepared to provide this information to the merchant account provider during the application process.

Creating a Solid Business Plan

A well-crafted business plan can increase your chances of obtaining a CBD merchant account. The plan should outline your business model, target market, marketing strategy, revenue projections, and any risk mitigation measures in place. A strong business plan demonstrates that your business is well-organized, has growth potential, and is a low-risk investment for merchant account providers.

Establishing a Strong Online Presence

A professional online presence is essential when applying for a CBD merchant account. High-quality website design, informative content, customer testimonials, and a transparent pricing structure can all positively impact your chances of approval. Additionally, a strong social media presence helps establish credibility and trust among customers and merchant account providers alike.

The Application Process for a CBD Merchant Account

Once you have prepared your business for the application process, it’s essential to understand the required documentation, tips for a successful application, and the underwriting process.

Required Documentation

The following represents some of the documents you may need to provide during the application process:

  • Business license
  • Articles of incorporation
  • Owner’s personal identification, such as a passport or driver’s license
  • Bank account and routing number
  • Voided check from the business account
  • Proof of domain name registration
  • Certificate of Compliance or third-party lab results
  • Detailed list of products being sold


Assembling these documents ahead of time can expedite the application process and increase your chances of approval.

Tips for a Successful Application

To improve your chances of securing a CBD merchant account, consider the following tips:

  • Be transparent about your business operations, including suppliers, products, and marketing strategies. 
  • Ensure your website fully complies with all requirements set forth by the merchant account provider.
  • Demonstrate financial responsibility with a history of low chargeback ratios and processing volumes that align with your projections.
  • Consider hiring a professional to review your application before submission.
What to Expect During the Underwriting Process

During the underwriting process, the merchant account provider will scrutinize your application, perform a thorough risk assessment, and determine the terms and conditions of your account. 

This process may take anywhere from a few days to a few weeks, depending on the provider.

Be prepared to provide any additional information or documentation requested during the underwriting process promptly. Keep in mind that patience and persistence are essential when navigating the hurdles of obtaining a CBD merchant account.

The Bottom Line

Securing a CBD merchant account for your business involves understanding the complexities of the industry, selecting the right provider, and preparing your business for the application process. By following the steps outlined in this guide, you’ll be well-equipped to navigate these challenges and put your CBD business on the path to success.

Contact us if you’re curious about how Vendo helps maximize CBD merchant profits. We’re happy to have a conversation about how we can support you and simplify the burdens of credit card processing.