How Working with CBD Can Affect Business Owners
Since medical marijuana and CBD have been legalized in many US states, CBD products are popping up everywhere. It seems that everyone is trying to sell products that are infused with CBD oil. But, how does working with a product that was, until recently illegal and therefore a bit of a taboo, affect business relationships?
Many banks and credit card processors are incredibly reluctant to approve CBD oil businesses for accounts . It has even been reported that CBD business owners have had their accounts closed without notice. So how is a CBD business owner supposed to survive, let alone thrive, without these essential business partners?
Until recently, CBD products were still listed as Schedule 1 drugs by the federal government along with all other marijuana and hemp products. We all know that several states have done away with the prohibition of marijuana, but only in 2018 were hemp-based products removed from the Schedule 1 list, thus making CBD federally legal. Of course, there are rules and regulations that any seller of CBD oil-infused products must comply with to remain on the right side of both the state and federal laws.
There are so many variations in state laws we recommend that you check with your state and consult an attorney to be sure you are following all of the rules. Basically, selling a product that can still be considered illegal in some instances makes it very difficult to be approved for merchant accounts . “Only a small number of high-risk specialists accept CBD businesses, and in many cases, they’ll require you to obtain an offshore merchant account” .
Many business owners have tried to use PayPal or Square, but this ultimately leads to being dishonest about the nature of the business . Not only is this a practice that just doesn’t feel good (you want to be proud of the business you run), but these companies will not hesitate to shut you down if they find out you are being dishonest about your operation.
If you own a CBD business, there are resources available to find merchants that will work with you. Also, there should be more and more merchants joining in on the CBD craze soon so, fear not. However, until CBD is fully legalized in all 50 states, there will be merchants that just will not work with you. Until then, your best bet is to do your homework and consult with an attorney or expert, so you aren’t left without any merchants or accounts that are shut down without notice.