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CBD Payment Gateways & PayPal Issues Over the past few months, a number of CBD brands and online stores have had their PayPal removed, leading them to ask me questions about why this has Online trading and dropshipping have evolved to a point where almost anyone can start an online business from home. CBD products have become a popular item to Merchants selling CBD need to establish high risk payment processing solution. Let PayKings establish your high risk merchant account today!

CBD Payment Gateways & PayPal Issues

Over the past few months, a number of CBD brands and online stores have had their PayPal removed, leading them to ask me questions about why this has happened, what the PayPal policy is around the sale of CBD and what they can do to fix the situation. So, let’s step back and look at the PayPal policy first.

PayPal Policy

I contacted PayPal directly, speaking to Claudia from their Press Office, asking for advice and what message they would like to send to any brands wanting to sell CBD. They sent the following response:

As reflected in our Acceptable Use Policy, PayPal currently does not permit the use of our payments platform for the sale of products containing Cannabidiol (CBD)”.

But I had an issue with this. You see, if you were to go onto Holland & Barrett, Boots or Lloyds Pharmacy, you will find you can purchase CBD oil using PayPal. It would appear one set of rules is being applied to them which doesn’t meet their Acceptable Use Policy. I enquired about this matter, but the response I got was:

“PayPal has no further comment to add on this.”

It would appear this isn’t the first time they have been asked this and the solution is to ignore the question, quite frustratingly.

It should also be stated, to those saying this is unfair, that PayPal isn’t a regulated bank and actually have every right to do this (even if we all find it very frustrating). In their actual policies, it states that they can freeze your funds for up to 180 days if they feel you are breaking their acceptable use policy, meaning any money you have in the account could be held for an extensive period of time, which could be devastating to many brands cashflow situations.

So what about other payment gateways that you could use?


This is unfortunately another roadblock, as Stripe have stated the following:

“We aren’t able to support businesses selling CBD products at this time”.

While some brands allow other forms of hemp products to be sold, a representative from Stripe has stated “we impose a blanket ban on the sale of any products related to marijuana, including hemp and CBD oil.”

Even when asking around products that contained zero THC, the answer was a no.

However, there was a positive note at the end. They had this policy because at the time it was set, CBD was a schedule 1 drug, whereas now they know it isn’t, they will undoubtedly change the rule at some point in the future. Without the threat of them receiving large fines, the door is ajar, we just need someone to push hard enough.

Who Says Yes?

I’m sure you must be scratching your head wondering what options you have left! Well I’ve listed below all the different CBD Payment Gateway options for you to consider and tried to list all of the associated costs.

Total Processing

They claim to have a 100% approval rate, which is relieving for many brands that work in a supposed ‘high risk’ area such as CBD. The brand has a strong reputation for working with brands within gambling and adult entertainment, as well as CBD.

The payment gateway solution has PCI-DSS level 1 security in place, while they accept over 100 currencies in 196 countries.

Direct Pay Net

Launched in 2009, this company is a full merchant service solution provider, while they offer their services to CBD brands.

They will require a history of financials, proof of company ownership, licensing for any regulated products and website compliance.

MWB Solutions

One great option is MWB Solutions, which has an e-commerce gateway which works with various platforms such as WordPress, Shopify, WooCommerce, Magento, Joomla and Drupal. They also have a PoS and credit card terminals.

Speaking to their owner Warren, they stated:

“We do process payments for CBD based products, as long as it contains less than 0.2% THC and the application is quite thorough.”


As of October 2019, Square have also started opening up payment processing for CBD products, following an announcement at a conference. They do state that there is a very strict level of due diligence taken on the companies that are selling, but that they are relaxing their rules, charging CBD sellers 3.9% in the US and an extra 10 cents per transaction for swipe, tap and dip payments.


Lumi-Pay offer a one-click solution, integrating with the main content management systems such as WordPress, Shopify, Magento and Joomla. The brand focuses on the UK and countries within the EU, while they’re open to working with high-risk industries such as CBD.

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So in conclusion, you will miss out on a fair amount of earnings as a number of people want to do payments via PayPal, but it looks like PayPal are shooting themselves in the foot and missing out on a large amount of revenue, as companies will be looking to alternative solutions for their e-commerce payment gateways.

Does PayPal Allow CBD Sales?

Online trading and dropshipping have evolved to a point where almost anyone can start an online business from home. CBD products have become a popular item to buy online. Still, due to regional legislative differences, CBD is not always an easy industry to operate in and support is often lacking. PayPal is a popular online payment platform, but does PayPal allow CBD sales?

PayPal does not allow CBD sales at this time. PayPal’s policies prohibit the use of its payment system to accept money for the sale of CBD products. This is mainly due to CBD legislation varying considerably between different regions. But there are other payment options that do allow CBD sales.

Starting an online CBD business can be challenging, which is why it’s essential to know which services you can and cannot use. With the correct information and guidance, selling CBD online is easy to do. Let’s look at some reasons why PayPal’s payment platform does not allow CBD sales, and then find some other systems you can use to sell CBD products online.

Table of Contents

Why PayPal Doesn’t Allow CBD Sales

The possession, use, and sale of CBD oils and products have become legal in more and more locations worldwide. For example, in the United States, CBD is already fully legal in ten states, with varying degrees of legality in the other forty states. It is generally accepted that the safest bet for users is to order CBD products online and have them shipped.

The problem is that it’s not always easy to know how to comply with the legal requirements regarding CBD sales. On a single road trip in the US, for example, you may pass through areas where it’s completely legal to buy and sell CBD products. But very quickly, you may pass through a state that forbids CBD sales. That’s why selling CBD products can be challenging.

This problem accelerates when you consider worldwide online payment and sales platforms. Then the issue can become enormous. PayPal is active in over 200 countries, each with its own CBD legislation and policies. Some of these countries have multiple legislative areas with varying CBD regulations within their borders, which makes selling CBD products even more difficult. [ 1 ]

A company like PayPal cannot be expected to have appropriate policies for every region where its services are available. Until the sale of CBD products is more widely approved and legalized, it is simply not practical for PayPal to allow the use of its payment platform for CBD sales.

Another problem is that legislation regarding CBD is still in its infancy, and in some countries, regulations change rapidly. This makes some banks and financial institutions, like PayPal, view CBD as a “high risk” market, even though it’s obviously a lucrative industry. PayPal stays away from industries labeled as “high risk,” and this includes the CBD market.

A further unfortunate fact is that there’s still stigma surrounding CBD despite the fact that it is used in many commercial pharmaceuticals and its health benefits are widely publicized. Many people are still afraid to use CBD, which could cause them to view PayPal in a bad light if the payment platform were to start approving CBD sales on its platform.

Can Anything Be Done to Change PayPal’s Policies?

Public opinion may have some influence regarding CBD sales, and the PayPal Corporation welcomes user feedback on its policies. PayPal even created a web page where anyone can easily share opinions and ask questions about government regulations and public policies, which is available at https://publicpolicy.paypal-corp.com/about-us#contactus.

There are no guarantees, and as mentioned, it will take a lot of effort for PayPal to update its platform to allow CBD sales. But if the company has proof that there’s enough demand for CBD products, it may find that this market is lucrative enough to consider servicing. [ 2 ] [3 ]

What Alternatives Are There for Online CBD Sales?

Most experts recommend that CBD resellers register a CBD Merchant account to keep their businesses safe. These are accounts that allow you to accept credit card payments to sell CBD products. To register for a CBD Merchant Account, you simply find a payment platform that’s made provisions for CBD sales in its policies. Luckily, there are many to choose from!


USAePay has been around since the late ‘90s and specializes in high-risk merchant accounts, including businesses that sell CBD. When a company has been active for more than two decades, we can assume it knows its business, so this is in USAePay’s favor. This payment platform offers a gateway that’s compatible with most online retail platforms, and card machines are also available for those who want a walk-in shop.

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NMI supports a wide range of payment options on a global scale. Users can make payments with credit cards, debit cards, or ACH from many different countries around the world. Transactions cost as little as $0.05 each, which is very affordable compared to some of the company’s competitors. NMI’s reporting systems are also exceptional and offer detailed information about transactions.


PayKings has earned a reputation in high-risk industries as a reliable and well-respected service provider. Specializing in high-risk merchant accounts, including CBD sales, PayKings has many advantages like direct links to more than twenty banks, rates as low as 2.49%, and exceptional integration with most platforms.

SMB Global

Many consider SMB Global the perfect merchant account provider for start-up businesses. Excellent customer service makes it easy for users to get started, and fair rates and contract terms mean you know what you’re getting and how much you’re paying. For larger businesses with offshore accounts, you have to process a minimum of $50,000, which could be a challenge for very young start-up businesses.

Easy Pay Direct

Easy Pay Direct has a longstanding reputation for being one of the biggest names in payment processing for low-risk industries, but its services are now also available for high-risk markets like CBD sales. There’s a setup and monthly account fee, though neither of these fees is exceptionally high, and Easy Pay Direct’s lower transaction fees make up for it. Generally, this is an excellent platform for CBD sales.


Founded in 2017, PayWize is a relatively new company, but it has grown to become one of the CBD industry’s most popular merchant payment processors. It already provides services to a considerable number of CBD oil merchants and medical cannabis dispensaries in the United States. It is compatible with many platforms and offers flat-rate pricing for processing CBD payments.


iPayTotal is ideal for the international market since, though the company is based in the United States, this service is available all around the globe. Unfortunately, a minimum weekly sales requirement of $1,500 could make iPayTotal less than ideal for very young startups, at least initially. But for the international market and businesses outside the US, it’s hard to beat iPayTotal’s offerings. [ 4 ] [5 ]


Inconsistent legislation is a problem that plagues the CBD industry. It means that you cannot use well-known and reliable platforms like PayPal to sell CBD products. And yet, the CBD industry is booming, and gradually more and more payment providers are opening up their services to the CBD market. Fortunately, there are platforms similar to PayPal that are ready and willing to facilitate CBD sales.

How Can Payment Processing Impact CBD Merchants?

Traditional payment processors can have a significant impact on CBD merchants. Processors like PayPal, Stripe, and Square are big names in the processing industry that offer traditional services. These services are fine for low risk industries. However, when a business becomes more complex, a CBD processor becomes the best solution.

PayPal CBD and Policy Violations

Oftentimes, CBD merchants don’t know this when establishing payment processing. When CBD merchants use traditional processing, they put their entire business at risk. Traditional processors typically ban the sale of CBD. Violating this policy can result in a merchant’s account being frozen. Merchants are left without access to their business and any funds in their merchant account. This is an urgent problem for a merchant to face.

Keep your CBD merchant account protected and know the policies of traditional payment processors.

Don’t Get Dropped By PayPal – Get A CBD Merchant Account

Selling CBD classifies a merchant as a high risk. This is due to the advanced regulation and specialization that high risk industries require. CBD merchants operate in an industry where regulation is continuously changing. Since the sale of CBD was legalized in 2018, a lot of factors continue to evolve. Due to this, the sale of CBD becomes a higher risk than the average product on the market. Only a high risk payment processor can safely and effectively process payments for high risk merchants.

PayPal’s CBD Policies

PayPal CBD policy is pretty straightforward. As one of the earliest payment processors that changed eCommerce, they choose to avoid accounts that are high risk. PayPal makes it very easy for merchants to sign up and begin accepting payments right away. However, PayPal only caters toward low risk industries. A low risk industry does not experience high chargeback volumes. High chargeback volumes are typically associated with a high risk business. If PayPal detects more elevated than normal rates, a merchant’s account and all payment processing functions will be suspended until a further review is completed.

This process could take weeks due to the size of PayPal’s platform. Since PayPal does not allow high risk industries to use their platform, CBD merchants are out of luck. On PayPal’s policy page, it states that products containing Cannabidiol may not be sold using the platform. PayPal does not accept or facilitate any CBD payments. This is because the regulation on the sale of CBD products is constantly changing. So, PayPal does not want to worry about being in regulatory compliance by banning this sale. The same can be said for other high risk industries. PayPal’s policy states that any business deemed as high risk will not be supported on their platform.

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Stripe’s CBD Policies

The Stripe CBD policy has similar restrictions to other traditional payment processors. Their popularity in traditional processing often confuses high risk merchants. Many high risk merchants don’t even think twice when signing up for Stripe’s platform. But unfortunately, a merchant’s high risk business will likely be shut down once discovered on Stripe. Stripe’s policies state that high risk industries are restricted from using any aspect of the platform. Among those explicitly stated is any Cannabidiol product. Stripe’s CBD policy is zero tolerance. This means if a merchant is discovered selling CBD, they’re account could be frozen. Now, it is up to the merchant to establish a high risk merchant account to regain their business and funds. Once this is done, Stripe can release funds and deactivate your account.

Stripe uses machine learning through Radar that can evaluate each payment’s risk in real-time. Radar is a helpful tool for merchants and can even protect them from fraud. While on the other hand, it means that merchants using Stripe are continually being evaluated for risk. High purchase volumes or an increase in chargebacks can make merchants appear to be high risk to Stripe. Radar can automatically flag your merchant account for Stripe to review. This may come along with your account being temporarily frozen. However, if you are a high risk merchant, you know that your industry comes with abnormally high chargeback volumes. Stripe does not have expertise in high risk, nor do they want to. So, this is why high risk merchants cannot look to Stripe for long-term processing solutions.

Square’s CBD Policies

Recently, the Square CBD policy has changed. They launched an early-access CBD program for high risk merchants. The program is a limited access trial that allows merchants to sell CBD on Square’s platform. When CBD sales were legalized in 2018, Square felt that there platform needed to be opened up to this new market. So, Square processing has been made available for all types of CBD transactions. There is a CBD processing solution for in-person, online, in-app, and virtual terminal sales. Square CBD processing offers a clear price breakdown for each solution on their website.

Square is one of the first traditional platforms to delve into CBD processing. However, merchants must undergo intensive screening to make the cut. Square makes sure all products sold on their platform are under the THC threshold. Additionally, the Square early-access program is only a trial for the payment processing company.

High risk merchants seeking solutions through Square’s traditional payment processing platform are out of luck. The platform does not support high risk industries due to the specification and expertise needed. Without knowing this policy term, high risk merchants can get caught in a violation of terms. This results in the merchant account and funds freezing until a high risk account is established elsewhere. A full list of policy terms, prohibited goods, and restricted sales can be found on Square’s website .

Let PayKings Establish Your CBD Merchant Account

High risk merchants who establish payment processing via traditional platforms are sure to run into some trouble. PayPal, Stripe, or Square just can’t fit a high risk merchants needs. So as a high risk merchant, it is essential to understand payment processing in your industry. As a high risk merchant, there are plenty of reliable options out to choose from.

Allow PayKings to get your CBD merchant account started off the right way with a high risk solution. As experts in the CBD industry, PayKings knows what high risk merchants need. Let PayKings set your CBD business up for success with a high risk merchant account and a high risk payment processor. PayKings has numerous trusted card relationships so that you can accept more payments. Skip the stress and establish your high risk CBD merchant account today with PayKings. In as little as 48 hours, an experienced team member will walk you through the process of getting high risk processing established. At PayKings, we know there is no compromise for quality and security in the CBD industry. So call PayKings today to get your CBD merchant account on the right track.

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