For any business, the need for a merchant account or the ability in some manner to process credit card transactions is vitally important. Without the ability to complete credit card transactions, it is very difficult to operate a business today as many people pay for their purchases with some form of plastic, such as a debit card or credit card.
However, getting a tobacco merchant account for related business is extremely difficult for several reasons, which include:
- Merchant account providers consider tobacco related businesses a high-risk situation for merchant accounts.
- Tobacco is a highly regulated product by the government.
- Conducting business online increases the high-risk associated with tobacco related businesses getting a merchant account.
If you are looking to obtain a merchant account for your tobacco related business, you must understand and deal with the major problems that all businesses face in the tobacco industry.
Merchant Account Providers Consider Tobacco Related Businesses A High-Risk Situation For Merchant Accounts.
Merchant account providers have certain types of businesses that they consider high-risk. The term high-risk related to merchant accounts concerns the chance of a card transaction being fraudulent. Merchant account providers dislike fraudulent transactions because the transactions result in a variety of internal and external issues for the merchant account provider, cardholder, and the merchant. Therefore, merchant providers prefer to avoid businesses that they consider high-risk because the account is not worth the potential trouble that could possibly occur with the merchant’s transactions.
Tobacco Is A Highly Regulated Product By The Government.
The tobacco industry has been under intense scrutiny from the government for several decades. Issues related to public health, high profile court cases, and bad public relations have placed the tobacco industry in a bad situation. As a result, the government has established numerous regulations regarding the use and sale of tobacco products. These regulations make it extremely difficult to operate a tobacco related business.
Conducting Business Online Increases The High-Risk Associated With Getting a Tobacco Merchant Account.
Just obtaining a traditional merchant account is hard for most tobacco related businesses; however, trying to obtain a merchant account that allows online sales can be almost impossible in many instances. Online transactions for any business increases the risk associated with the transactions. However, combine the inherit issues with online transactions with the high-risk label already placed on tobacco related businesses and you have a much tougher problem obtaining a merchant account.
If your looking to sell your tobacco products, contact Painless today to help you get approved!