Selling E-Cigs online is lucrative, but it’s a venture you can’t take on without an account. And not just any account, but an eCig merchant account. These are merchant accounts issued to businesses related to electronic cigarettes.
Due to the risky nature of the business, particularly the high level of chargebacks, you will require an e-cig merchant account as most traditional banks that issue low risk merchant accounts won’t support your business. And because you can’t just walk in to your local bank and get easily approved like any low risk business would, you have to consider applying for a merchant account with a high risk card processor.
However, e-cig merchant accounts normally have slightly higher costs compared to low risk merchant accounts. Also, depending on the status of your specific business, it may have a few additional restrictions like a monthly processing volume cap, funding delay or a rolling reserve. Most of these restrictions can be lifted off within the first three months if you prove that you can successfully process credit cards.
Application Requirements for E-Cig Merchant Account
You can begin applying for an e-cig merchant account today with any high risk account provider like EMB. Most providers have a simple online application process. To ensure a smooth process, be ready with the following items;
- A valid ID, e.g. a driver’s license
- Printed Voided Check or bank letter
- Most recent bank statements ( for the last 3 months)
- Processing statements (for the last months but only if applicable)
- A Social Security Number (SSN) or Employer Identification Number(EIN)
- Your Chargebacks must be below 2%
First, confirm if the high risk credit card processor works with e-cig merchants. After that, submit an application along with all the above documents. The processor will then go through your application and other supporting credentials.
The underwriting team may also review your documents and ask a few questions. Finally, the processor will let you know whether you’ve been accepted (under specific terms and conditions) or if your application has been rejected. Assuming you’ve been approved, you’ll have your payment gateway setup or processing equipment shipped to you (if you wish to accept swipe payments). And just like that, you’re good to go.
Don’t waste your time seeking accounts from traditional banks as they have regulations that prohibit them from accepting eCig business. The best and only option you have is to apply with a high risk credit card processor.