Credit Card Processing Options for High-Risk Merchants
The ability to accept credit cards as a way of payment is not always a choice for all merchants. Specific companies are considered high-risk and therefore battle for eligibility for card processing services or a vendor account. Merchants in industries considered high-risk should either spend a lot of money for the privilege of taking credit cards or consider other payment options.
There are several elements which may deem a business “risky” in the universe of credit card processing. In certain situations it might just function as the credit score of the business owner, but in most cases, it’s the variety of business or industry in which the company operates. Online merchants or e-commerce companies are considered high risk as well as any adult businesses or travel businesses. One unique industry termed as risky by processors is the medicinal cannabis industry- which is lawful in 16 states and the District of Columbia. These retailers have had their processing rights lowered or eliminated to the point where taking cards for payment is not easy or even impossible.
Merchants officially allowed to distribute cannabis for medicinal purposes regularly fight to run their business despite being legally permitted to do this in specific states. Running regular business transactions and finding brokers may be hindered by laws designed to prevent the illegal sale of marijuana. These merchants might find themselves incapable of maintaining and opening financial accounts that would otherwise not be unavailable to other traders. While you can find several actions happening to try to make things fair for participants in the medicinal marijuana industry, including new bills being proposed to help these businesses with tax issues and other problems related to the sector, credit card processing continues to be a concern.
In regards to accepting credit card payments, numerous medicinal marijuana vendors will find themselves out in the cold. The reason this business has a lot of problems is simply that despite being authorized in certain states, the government doesn’t understand the medicinal cannabis sector as a lawful business. Considered illegal by the federal government signifies other companies for example banks and credit card processors may be punished for “conducting business” with a medical marijuana provider or participant.
As with several other high-risk industries, those in the medicinal marijuana industry might be forced to look to non-traditional alternatives to facilitate business transactions. In this situation, searching for a high-risk credit card processor who operates particularly within one sector may not be unhelpful to ensure services are always available. A seasoned payment processor who is not only prepared but able to work with a high-risk retailer is often the only choice available to ensure credit card processing is a choice.
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