Why is the CBD industry considered High-Risk for Merchant Accounts?
The fact that the general public does not have access to enough research is the first hurdle in this industry. Many people are pessimistic about CBD and think it carries “risks.” Due to the fact that THC, the psychoactive component of cannabis, is present in only minute amounts in CBD, this substance is neither addictive nor psychotic. Many people are unaware that CBD does not cause you to feel “high.” Instead, it is treasured for its calming qualities and is included in a number of wellness products.
Getting the products to market is one challenge faced by the majority of CBD companies in the industry. The market is heavily saturated. Newcomers need to carve out and maintain a niche. However, you still require a strong point of sale to accomplish that. Additionally, you must be aware of your target audience.
Some manufacturers have used deceptive tactics when it comes to eCommerce. They were reported to the FDA for not disclosing all the information about their products and for making exaggerated claims about the advantages of CBD, which had an impact on other companies that sell CBD products. In some countries, CBD is actually illegal. This includes parts of Asia because those nations have restrictive laws governing the CBD industry.
The CBD market has experienced rapid growth.
The exploding CBD (cannabidiol) market has garnered significant headlines and provided material for countless analyses and forecasts.
Numerous new businesses now have opportunities thanks to the CBD industry’s rapid growth. In addition to going far beyond the production and distribution of cannabis itself, new companies are creating CBD goods and services that are entirely legal. There are now a large number of businesses in this industry, many of which produce, package, or market CBD products. Business News Daily reports that $20 billion in sales are anticipated for the CBD sector by 2024. The Cowen analysts’ projected estimate of this market’s revenue of $16 billion by 2025 was even more intriguing.
This broad industry has many facets because CBD is promoted as a medical solution for a variety of issues. CBD has a proven track record of treating epilepsy, and MS and helping cancer patients manage their pain. However, there might be risks that seem pitfalls for business owners in this industry.
Why is the CBD market so flourishing online?
eCommerce establishes a platform for CBD products that enable customers to buy CBD goods and get information about the potential advantages of CBD directly from the producer. If customers are worried that purchasing CBD is uncool, they can purchase it anonymously online. But the main reason CBD is developing into a sizable industry in and of itself is because of its therapeutic and holistic advantages. Customers can easily compare CBD prices when buying CBD online, enabling them to find the best offers in a crowded market. To ensure the best eCommerce experience, many CBD businesses also provide free online support, including chatbots.
Even though CBD can be bought in person, for instance in a health food store, many customers prefer to buy CBD products online because they find digital product descriptions easier to scan and read than packaging. An important piece of information, like the amount of THC in a product and the suggested dosage, will be displayed clearly in the product description for CBD products when purchased online, for instance.
Payment Processing for CBD Business
Since the passage of the 2018 Farm Bill, which was signed into law by President Donald Trump in December 2018 and exempted hemp from the Controlled Substances Act (CSA) definition of marijuana, more and more owners of e-commerce businesses are looking for payment gateways that support CBD merchant processing.
Radiant Pay offers the ideal mix of merchant account features to safeguard high-risk companies while enabling smooth cash flow. The rates for a CBD merchant account are higher due to industry regulations, even though they are comparable to those for other e-commerce businesses.
Any type of CBD retailer, including start-ups, mid-sized businesses, established enterprises, and public companies, may submit an application to purchase the payment gateway system and other services.
Are you looking for a CBD merchant account? To learn more about our services and to open a merchant account for your business, feel free to get in touch with us at https://radiantpay.com/contact.html. Understanding the client’s business needs, identifying suitable payment options, and actively participating in the choice of a Payment Service Provider that is best suited to the merchant’s requirements are all part of our consulting services.