High Risk Tobacco Credit Card Processing
A tobacco merchant account is a specialized credit card processing solution that allows businesses to sell tobacco-related products. With this type of account, merchants can accept payments with credit and debit cards from customers who purchase tobacco products. It is worth noting that tobacco merchant accounts are considered high risk, and not every acquiring bank supports this industry.
Specialized processing companies that have experience in working with high-risk merchants support tobacco businesses. These accounts are subject to strict regulations and proactive monitoring. Different regulations apply to tobacco sales in different nations; thus, the underwriting team must ensure that the accounts are only approved if they comply with all local and international guidelines, rules, and regulations.
QuadraPay has been assisting tobacco merchants since 2016. We are a proud provider of solutions powered by top high-risk acquiring institutions and are comfortable working with tobacco merchants. Ask us for details of our tobacco merchant account solution.
Types of Tobacco Credit Card Processing Solutions
An online tobacco merchant account is designed for businesses that sell tobacco products over the internet. Our solutions can be easily integrated into well-known shopping carts like WooCommerce, Magento, and OpenCart, among others. Our tobacco credit card processing solution comes with ready-to-use plugins and detailed APIs.
For retail businesses that sell tobacco and related products, we offer brand-new retail tobacco shop credit card terminals. These terminals provide excellent connectivity options, ensuring they are always connected and offer round-the-clock processing. Retail shop owners can accept face-to-face credit and debit card payments with these terminals. Additionally, these terminals are compatible with various tobacco point-of-sale (POS) systems.
KYC for Tobacco Merchant Account
When a business applies for a tobacco merchant account, they need to undergo the KYC procedure. In this process, the merchant needs to submit some important documents. The payment processor will verify these documents before approving the account. Here is the detailed list of documents that you must submit to the payment processor at the time of applying for a tobacco merchant account:
Business registration document, including a certificate of Incorporation or any other business license. This document helps the payment processor to confirm that the merchant’s company is a legal entity.
Proof of identity of the business owners is required to confirm that the owners are actually associated with the business. For this, the merchant can produce a passport, driver’s license, or any other national ID.
The payment processor also should be aware of the address of the director as well as the place of business. For this, the merchant can produce a utility bill for both addresses.
The bank statement or a letter from the bank confirming the account details give a clear indication that the business operates a valid bank account where the settlement can be received. Along with that, the statement gives an idea about the financial strength of the merchant.
A processing history gives a snapshot of the chargeback and refund ratio of the merchant. Along with that, it also gives additional details like average sales volume and average ticket size.
Businesses that are involved in selling tobacco or related products are required to submit additional documents. These include the tobacconist license and the proof of inventory. Along with that, these businesses may be required to register with their local Public Health Organization.
Additional requirements will be shared by the underwriting team of our partner payment processors. It is important for tobacco websites to ensure that the site complies with the applicable laws and regulations, which includes age verification requirements. By sharing all the KYC documents that the payment processor requests, merchants can improve the chances of their approval.
Tobacco Merchant Services Application Process
The application process for a tobacco merchant account with QuadraPay starts with the initial contact. You can fill the basic form on our website so that one of our tobacco payment processing experts can contact you. We will inform you about the available options and then request you to share the KYC documents. Once you share these documents with us, we will immediately send them to our payment processing partners who will evaluate your profile. Based on the judgment, you will either get an account approved or a refusal. In case of refusal, we will let you know about alternative options, but we will consistently work for you so that you get your account approved as that is our goal.
FAQ Tobacco Payment Processing
What kind of products does a tobacco store sell?
Tobacco merchants sell various tobacco-related products like cigarettes, tobacco pouch, cigars, pipe tobacco, smokeless tobacco, chewing tobacco, snuff, snus, hookah flavored tobacco, e-cigarettes, e-liquids, vape pens, mods, and coils. Additionally, they offer tobacco accessories such as lighters, ashtrays, cigarette cases, pipe cleaners, filters,, Bongs, hookah hoses and bowls.
What are the main tax compliance responsibilities of PSP’s for tobacco merchants operating across various jurisdictions?
It is worth noting for merchants that the sale of tobacco and cigars is regulated all over the world. The sale of tobacco is a major source of tax collection for many governments. When a high-risk merchant account provider underwrites a tobacco merchant account, they must verify how the tax information is displayed, collected, and paid. Basically, they must ensure that in all jurisdictions where the merchant sells tobacco, as well as in the merchant’s home country, no tax violations occur. Merchants must ensure that they implement the necessary tax adjustments and displays on their site to ensure hassle-free approvals.
