Cannabis cultivation has also improved in recent decades, making it easier for growers to grow particular types of cannabis, like hemp, which is famed for the fact that it contains almost zero THC (the part of the cannabis plant that causes a high-like sensation when consumed) and can be used for many different things, like paper, clothing, accessories, cosmetics, animal foods, and more.
The demand for hemp has never been higher, so many entrepreneurs are setting up hemp businesses in order to get in on this fast-growing industry and make a profit. But, in order to set up a hemp business, you need to get a hemp merchant account. What is a hemp merchant account and how does it work? Read on to find out.
Before we look more closely about opening and using a hemp merchant account, let’s first take a look at what the hemp industry is about and what it offers in today’s world. After all, it is one of the most rapidly growing and expanding industries out there, with countless new products and ways of working with hemp being developed all the time.
This is due to the fact that hemp is an immensely versatile plant. It can be used for everything from biofuel and eco-friendly plastics to paints, insulation, rope, textiles, and food products, too. With so many possible uses, there are a lot of ways to work with hemp and many different business ideas and opportunities that can be explored.
This has led to a real surge of growth in the hemp industry in recent times, with all kinds of hemp businesses starting up, from hemp clothing makers to hemp food creators and everything in between. Setting up a hemp business can therefore be an exciting way to work with nature, and a lot of places around the world have relaxed rules around working with hemp, making it easier and more accessible than ever.
If you want to start a business growing hemp or selling hemp products, not only will you need to be aware of all the rules and regulations in your area, but you’ll also need to make sure that you get a hemp merchant account. But what is a hemp merchant account and why is it so important to have one if you want to operate in this industry?
Well, let’s start off with a simple merchant account definition. A merchant account is a particular type of business account, aimed at businesses that do a lot of their sales online or over the phone, in the form of card-not-present transactions. A card-not-present transaction is any transaction in which the cardholder (and their card) is not physically present at the point of sale location.
In other words, if you want to make it possible for your customers to be able to pay you over the phone or on the internet via your online hemp store, you’ll need to have a hemp merchant account in place to make it happen. The hemp merchant account makes it possible for the payment to occur, processing the money from the customer’s account before it goes through to your main business account.
In the hemp industry, a huge amount of business is done online. People are looking online more and more frequently for hemp and hemp-derived products, and even though there are some brick and mortar stores out there, many of them also have online stores to appeal to the widest possible audience and have the best chance of success. If you want to do the same, you have to get a hemp merchant account beforehand.
We can clearly see that you need a hemp merchant account when running a hemp business. However, if you head to your local bank or regular financial institution and request one of these accounts, you may get denied. In addition, even other payment providers like PayPal might refuse to work with you, as many big payment companies are hesitant to work with high risk hemp businesses.
One of the big reasons behind this is that hemp is still strongly associated with marijuana in the eyes of many people, leading to a bad reputation for the hemp industry. And a lot of banks and payment processors simply don’t want to associate themselves with an industry that has that kind of reputation and associations.
Another issue is that the legal situation regarding hemp is subject to sudden and drastic changes; laws and regulations on growing and producing hemp can vary from state to state, and this can cause a lot of complications when companies are trying to work with hemp. It also results in more work with banks, as they have to check that the businesses they are working with are legal and following all the necessary rules.
Then, there’s the fact that the high risk payment processing of the hemp industry can lead to issues like chargebacks. Chargebacks occur when cardholders dispute payments and ask for their money back, and banks don’t like dealing with chargebacks in general, as they lead to extra fees and hassle for them. All of these reasons combined can make it very difficult to get hemp merchant accounts.
So, if you’re setting up a new hemp business involved in growing hemp, producing hemp products, or selling hemp-derived goods online, you’ll need to have a hemp merchant account to get started. However, due to the risks outlined above, it can be very difficult to get hemp merchant accounts in the first place, with many banks refusing to work with these sorts of businesses.
So what should you do if the banks around you are all saying no? Well, that’s where Shark Processing can help. At Shark Processing, we’re experts in high risk merchant accounts and high risk credit card processing. We know what it takes to run a high risk business, and we want to help you overcome some of the biggest challenges, such as obtaining your own hemp merchant account.
We can help you find the perfect hemp merchant account with one of our partner banks and payment providers from around the world. You’ll get the best rates and the finest service when working with the Shark Processing team. So give us a call today to learn more about how we can help with hemp merchant accounts and services.