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How Does Cannabis Payment Processing Work?

Cannabis payment processing refers to the process of accepting and processing payment transactions for the sale of cannabis products, which is still illegal under federal law in the United States. As a result, traditional banking and payment processing systems are not available to many cannabis businesses.

To get around this, cannabis businesses often use alternative payment solutions, such as cash or prepaid debit cards. Some companies also offer specialized payment processing services for the cannabis industry, which typically involve a high-risk merchant account, a payment gateway, and a secure payment processing system.

The payment process typically works as follows:

  1. Customer selects products and proceeds to checkout
  2. Payment is processed through the payment gateway
  3. The payment gateway communicates with the acquiring bank to secure approval or decline of the transaction
  4. If approved, funds are transferred to the merchant’s bank account

It’s important to note that the legality and availability of cannabis payment processing may vary depending on the state or country.


What Are the Current Cannabis Industry Payment Processing Options?

There are a variety of cannabis merchant solutions available for businesses in the cannabis industry to process payments. Some of the most common solutions include:

  • Cash or Prepaid Debit Cards: Many cannabis businesses still rely on cash transactions, or use prepaid debit cards as a way to process payments without using traditional banking systems.
  • High-Risk Merchant Services: Some payment processors specialize in high-risk merchant services, offering payment processing solutions specifically designed for businesses in the cannabis industry.
  • Point of Sale (POS) Systems: Some cannabis businesses use POS systems that are designed to meet the specific needs of the industry, such as compliance with state and local regulations.
  • Mobile Payment Processing: Mobile payment processing solutions, such as mobile card readers or smartphone apps, can also be used by cannabis businesses to process payments securely and efficiently.
  • Cryptocurrency Payment Processing: Some cannabis businesses are beginning to accept cryptocurrency as a payment option, which offers a secure and decentralized way to process payments.


It is important to research and carefully evaluate each solution to determine the best fit for a particular cannabis business, taking into consideration factors such as cost, security, ease of use, and compliance with relevant laws and regulations.


Is It Easier to Get a CBD, Hemp, or Cannabis Merchant Account?

money and marijuana

Getting a merchant account for CBD, hemp, or cannabis products can be challenging, as many financial institutions and payment processors view these businesses as high risk due to the regulatory and legal complexities surrounding these products. Compared to cannabis merchant accounts, CBD and hemp merchant accounts may be easier to obtain, as these products are derived from hemp, which is legal under the 2018 Farm Bill in the United States.

However, the legalization and regulation of CBD and hemp products are still evolving, and many financial institutions may still view them as high risk. It’s important to note that the availability and ease of obtaining a merchant account for CBD, hemp, or cannabis products can vary depending on the laws and regulations in the jurisdiction where the business is located, as well as the policies of individual financial institutions and payment processors.

Some specialized high-risk payment processors may be more willing to work with businesses in these industries, but it’s important to carefully research and compare the fees, security, and other features of different solutions to find the best fit for a particular business.



Using a high risk merchant account for an online cannabis store can be challenging, as the industry is still largely unregulated and considered illegal by the federal government in many countries. However, it is important to find a reliable and secure payment solution to ensure the smooth operation of the business and to protect both the merchants and customers.

It is advisable to conduct thorough research and seek the advice of experts to find the best option for your specific needs and to comply with all applicable laws and regulations.

Ryan Kemp Zulu Shack Creative
( Director of Digital Marketing )

I am passionate about delivering results and helping my clients succeed. With my expertise in SEO, branding, and marketing, I lead the agency’s efforts to create and implement effective strategies that drive business growth. Our all-inclusive approach sets us apart from other digital media companies and ensures that our clients receive the full range of services they need for online success. If you can think of it, we can build it!

Zulu Shack Creative team members thrive on momentum. Like Zulu warriors, we strive to spearhead your idea with speed and quality.

When I’m not helping my team implement new digital marketing strategies, I enjoy playing music, hosting poker nights, reading Stephen King novels, and spending time with my wife and baby daughter.

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