High-Risk Merchant Processing: A Guide for Smoke Shops & CBD Retailers
If you've been denied a merchant account or had your account frozen, you're not alone. High-risk businesses face unique challenges—but with the right partner, you can get stable, affordable processing.
What Makes a Business "High-Risk"?
Banks and payment processors classify certain industries as high-risk based on chargeback rates, regulatory complexity, and perceived fraud risk. This isn't a reflection of your business quality—it's an industry classification.
Common High-Risk Industries:
- • Smoke shops & vape stores
- • CBD & hemp retailers
- • Kratom & supplement stores
- • Age-restricted products
- • Online gambling & gaming
- • Adult entertainment
Why You're Classified High-Risk:
- • Higher chargeback rates in your industry
- • Regulatory uncertainty
- • Age verification requirements
- • Evolving state/federal laws
- • Higher average ticket sizes
- • Product liability concerns
Common Problems High-Risk Merchants Face
- Account freezes — Funds held for weeks or months without warning
- Sudden termination — Processor closes your account mid-business
- Excessive reserves — 10-50% of transactions held as rolling reserve
- Sky-high rates — 4-8% processing rates with hidden surcharges
- No support — Generic call centers with no understanding of your industry
The Processing Bros High-Risk Advantage
- Specialized banking relationships — We work with banks that welcome high-risk merchants
- Quickvee POS with built-in age verification — Automated compliance for age-restricted products
- Stable accounts — No surprise freezes or terminations. We understand your industry.
- Competitive rates — Typically 30-50% lower than what you're paying now
- Cash discount available — Eliminate fees entirely, even for high-risk businesses
- Dedicated account manager — A real person who understands smoke shop and CBD operations
Getting Approved: What You Need
Required Documents:
- • Valid business license
- • State tobacco/CBD license (if applicable)
- • 3 months of bank statements
- • 3 months of processing statements
- • Government-issued ID
Timeline:
- • Application: 5 minutes
- • Underwriting: 3-5 business days
- • Equipment setup: 1-2 days
- • Go live: Within 1 week