Establishing Your CBD Merchant Account

May 28, 2020

A CBD Merchant Account is key to staying within legal limits, offering security.

What’s all the buzz about CBD oils?  You may have seen these initials scattered throughout many strip malls’ storefronts, displaying a particular green plant as their logo. Don’t worry, it’ s legal. Let’s get the 411 on this mysteriously popular product. 

What Is CBD?

CBD is an acronym for cannabidiol which is derived from the hemp plant. Although CBD is an important part of medical marijuana, it does not actually cause a person to get “high”. The World Health Organization has declared that, 

“In humans, CBD exhibits no effects indicative of any abuse or dependence potential…. To date, there is no evidence of public health related problems associated with the use of pure CBD.”

CBD is readily available in all 50 states throughout the United States, with some restrictions dependent on the state. The federal government has taken a more prohibitive stance as it categorizes it in the same class as marijuana. Yet, it hasn’t actually enforced its prohibition. It really comes down to determining whether the CBD is derived from the hemp or marijuana plant. 

The use of CBD has been credited for addressing a wide range of health issues such as  epilepsy syndromes like Dravet and Lennox-Gastaut syndromes, insomnia, anxiety, and chronic pain. A study conducted by the European Journal of Pain demonstrated that using CBD oil on the skin can lessen pain and inflammation due to arthritis.

The most troubling safety issue with the current industry is that CBD is most widely sold as a supplement and not as a medication. At present, the FDA is not regulating the purity and safety of all supplements on the market. As a result, there is no way to verify if the product contains the active ingredients at the dosage labeled on the package. What is also unknown is whether or not the product contains other mystery ingredients. Finally, another missing link is that the exact dosage necessary to treat any specific medical condition is largely unknown.

The CBD Industry Trend

One thing we do know is just how popular CBD has become and how much more it will be in the near future. The Brightfold Group made the prediction that the U.S. CBD market is projected to hit $22 Billion by the year 2022. 

Much of this growth has been spurred by an increase in the investment of research and development by pharmaceutical companies, CBD imbued cosmetics, the growing legalization of medical marijuana, CBD infused treats for pets, tinctures, the list goes on and on. Even soda giant Coca-Cola is in talks with a Canadian company by the name of Aurora Cannabis to develop a CBD drink. The point is that the possibilities to launch CBD-containing products is truly endless.

Interested in opening up a CBD business? 

Now that we have established the incredible health benefits as well as this potentially profitable industry. You might be interested in launching your own CBD venture. However, before you start knocking on merchant account provider’s doors, hoping to open a merchant account and begin processing credit card payments, you must familiarize yourself with the industry’s lay of the land.

First of all, most traditional banks and merchant account providers will not grant you a CBD merchant account because CBD products have been placed in the high risk category.  The reasons are as follows:

  • Unfounded claims about the efficacy of CBD products
  • Legal issues surrounding the distribution of CBD products
  • Incredibly high chargeback rates. 

As previously mentioned, the FDA has no involvement in the verification of the ingredients and benefits found within each CBD product. Secondly, since there is a lot of misinformation and false claims about CBD being the “cure-all” for all diseases, especially cancer, you will have consumers who try the product and not get results. As a result, the consumer will file a chargeback with their bank. Finally, banks and merchant processors don’t want to get involved with products that exist within a nebulous legal status. Although CBD is legal in every state, it is subject to specific laws that are particular to the state. This in itself is an underwriting nightmare for any bank and processor.

How To Find The Best Merchant Account Provider

The best merchant account provider will be one that specializes in the high risk industries, like CBD. A high risk merchant account provider like EMB or ( is your best solution for all your CBD processing needs. EMB is a leader in the high risk industry and is well-acquainted with the CBD industry.

Some of the CBD businesses that EMB works with include: supplements and vitamins, pet products, oil, beauty products, edibles, creams, topical treatments, and so much more.

Before moving forward, make sure you increase your chances for the approval of a merchant account. Actions you can take now include:

  • Protect Your Finances: Make sure your bank statements are not riddled with overdraft fees or instances of having low balances. Try to maintain a fairly large volume of transactions for every month. This will demonstrate you as a strong candidate for investment.
  • Eradicate Chargebacks: Chargebacks can negatively impact your business as it communicates the inferiority of your product or service. Make sure your refund policies are clearly stated on your website and up your customer service game. This could dramatically decrease your chargebacks.
  • Fight Friendly Fraud: Although the acceptance of CBD is growing by leaps and bounds it is still not quite as mainstream. Some customers may purchase a CBD product from you, but later deny the purchase and seek a refund (aka. Trying to get something for free). Don’t fall for it. Make sure you have the systems in place to prove the purchase. 

It’s Time To Apply For Your CBD Merchant Account

After you have done all of the above, it’s time to move forward with the application process with confidence, knowing you have done everything necessary to increase your chances of approval. The next step is gathering all your necessary documentation to submit with your online application. Here is what you need:

  • A voided check
  • A government issued ID like a driver’s license
  • Three month’s worth of processing statements
  • Three month’s worth of recent bank statements
  • Chargebacks must fall under the 2% mark
  • Fully operational, secure website

Once you have all documentation at the ready, you can now go to and fill out your application completely online. It’s quick and easy. Submit it along with the aforementioned documentation and you simply have to wait 24 hours for approval. Done!

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.