What Are The Required Documents For Cannabidiol (CBD) Business To Get A Merchant Account?

QuestionsCategory: CBD Merchant AccountWhat Are The Required Documents For Cannabidiol (CBD) Business To Get A Merchant Account?
Naman Verma Staff asked 1 month ago
1 Answers
Bankim Chandra Staff answered 2 weeks ago

This is a very common question asked by CBD Merchants. It is certainly a good question. A CBD Oil Merchant must know what are the key documents needed to get approved for a CBD Oil credit card payment solution. let me quickly share some light on the same.

This response is in relation to CBD Oil and Related Product Sellers in The European Union/EEA.

First let us understand what Acquirers are looking to find in CBD Merchants.

  1. Good Profile. There is one thing common in getting a merchant account and credit card. In both cases the financial institution(FI) checks the financial standing of the applicant. The FI also check the credit score of the applicant. Merchants with good financial standing and good credit score have better chances of approval with CBD Merchant Account. This does not mean that there may not be options for those with low credit score. APMs and other alternative methods can keep budding merchants in business and in the meantime merchants can focus to strengthen credit score and financial standing.
  2. Existing History. We get tons of application for CBD oil merchant from EU/EEA. Actually we get CBD Oil Merchant applications from Canada and USA as well. In many applications we see that merchants state that they dont have processing history. This is not true in many cases. Merchants sometimes hide there past processing experience. May be the account was closed. May be they did not process at all. May be they did a very low volume. The point which i am trying to state is that if you have a processing history share that. If the account was terminated then also let us know.
  3. Product Configuration. Here Product configuration means lab certificates. The CBD oil products that you sell should not have THC over 0.2%. If the merchant provides lab certificate and has good profile chances are that the result may be yes.
  4. Office Location. Merchant must have a physical location in the jurisdiction of the processor. Processors are only allowed to sign up merchants from approved jurisdiction. for the sake of an example a processor licensed to say yes to EU merchants may not say yes to Canada based CBD Oil merchant. This is because the merchant is responsible for the account. If the account has any issues and requires legal viewpoint for resolution the processor may not be able to have a commanding control in external jurisdiction. If your address is virtual office then probably its the time for you to see if you need to take a physical office. In most cases how big or expensive the office is does not matter. However you may have visitors from the processing company for site audit.
  5. Directors Nationality. All EU Credit Card Payment Providers require EU directors. Some may allow non major EU directors however any one with 20% plus stake is generally considered a major stake holder.
  6. Target Markets. You cant sell CBD Oil Products every where . Each nation has its own viewpoint . The processing company based on there internal SOP will allow and block traffic from specific nations. Its better to ask the merchant account provider about the target nations before sending application. Some may only allow EU Traffic. Some May block few nations in EU. Some may allow non EU traffic but only till a set %. In a nutshell it depends on many factors and requires a consultative approach.
  7. Website traffic. CBD Merchant Accounts are used for CBD Oil Sales. We all know that but how does a merchant generate sales on eCommerce CBD Site. Its generated by web traffic which can be seo driven and be paid. There are tools that easily show the organic and inorganic traffic strength of a website. CBD oil Payment gateway companies check the traffic and traffic source. If this suits there requirement then they may have some more interest in the application. Traffic alone is not a success factor but can be considered as one factor. Don’t know how to generate traffic on CBD Oil website then you can approach our other site and learn how to do so. SEO Traffic for CBD Site.

Now lets look at Key Documents that are needed

  1. Company Proof. This can be the company registration certificate or any relevant certificate in the nation where merchant is registered
  2. Bank Letter. This is needed to confirm the account where merchant will receive funds from the credit card processing company
  3. Document for Proof Of Address Business and Directors. This can be utility bill.
  4. Lab certificate. That shows the product is legal to sell in EU and has THC% within the approved limit.
  5. Legal opinion. Some times processing companies may ask for legal opinion. This can be for multiple factors like target market, Product does not violate any laws.
  6. Translated Documents. This may be needed if the documents are not in English in This case merchants can get the documents translated and certified by a registered notary. The Notary licence should be verifiable.

Here is an article about CBD Oil Merchant Account in Europe.