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 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?

Stripe

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.

MWB Solutions Say Yes!

I’m sure you must be scratching your head wondering what options you have left! Well 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.”

Finally, a shining light!

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.

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.

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