Hemp off controlled substances list, CBD market heating up
Paybotic, a Florida-based ISO specializing in high-risk businesses, revealed it is now boarding merchants selling CBD products online and in card-present environments. CBD (short for cannibidiol) is a non-psychoactive compound found in cannabis plants that has been hailed for its health benefits.
CBD can be sold and used in various forms, including tinctures, lotions, mists, infused drinks and candies, and vape pens. Most CBD products are derived from hemp plants, a variety of cannabis grown for industrial uses that has extremely low concentrations of THC (the compound found in the cannabis plant marijuana that can alter a person’s state of mind or consciousness).
Interest in CBD products has exploded in recent years as more states legalize marijuana and CBD. To date, at least 33 states have legalized marijuana for medicinal and recreational uses; 40 have legalized CBD. And on Dec. 20, the Agriculture Improvement Act of 2018 was signed into law. It reclassified hemp as an agricultural product on par with corn and soybeans – a move experts suggest could boost the market for CBD product sales.
“Among other things, this new law changes certain federal authorities relating to the production and marketing of hemp, defined as cannabis (Cannabis sativa L.), and derivatives of cannabis with extremely low (less than 0.3 percent on a dry weight basis) concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC),” the FDA stated directly after the act became law. “These changes include removing hemp from the Controlled Substances Act, which means that it will no longer be an illegal substance under federal law.”
According to the market research firm Brightfield Group, CBD products generated $500 million in sales in 2017, and are on track to generate $22 billion in sales by 2022. Most merchant acquirers, however, have so far stayed clear of boarding CBD merchants because of its relationship to marijuana and federal prohibitions on cannabis.
“Legitimate businesses selling CBD products need to be able to accept modern methods of payment, like credit and debit cards,” said Max Miller, CEO of Paybotic. He added that Paybotic, which has been building a book of business with cashless ATM solutions for cannabis dispensaries, is well positioned to serve this emerging vertical market. “We understand the requirements of CBD merchants, and partner with banks and card processing companies that have policies, procedures and technologies in place to support this burgeoning market,” he said.
Paybotic is the latest in a small army of ISOs that have recently begun boarding CBD merchants. American Bancard LLC, dba TouchSuite, reported in November 2018 that it is now pursing what it describes as the “hyper-growth” market for CBD merchant accounts.
Another Florida-based ISO, EthosPay, began boarding CBD merchants last year, and business has been booming, said Shea Robinson, the company’s press manager. “[I]t looks as though 2019 will be another banner year,” Robinson added.
CBD Vape Merchants Can Now Accept Credit Cards Online!
US Approvals within 3-5 Days! Paybotic is now boarding CBD vape merchants! Yes, you read that right: CBD vape merchants!
Until now card-not-present merchants selling CBD hemp products have not been allowed to process card payments for vape and related products through traditional merchant accounts. This is not the case anymore! CBD merchants selling vapes and related products can now accept credit card payments for all orders with Paybotic.
Paybotic is the premier payment solutions company that excels in tailoring solutions to the cannabis, CBD and hemp industry. We ensure compliance and continuity with state-of-the-art technologies, by partnering with banks that understand the underwriting process for cannabis products, and through continuous monitoring of the shifting legal landscape for cannabis sales.