How to Start Selling CBD on Shopify: High-Risk Payments and Compliance

Launching a CBD store on Shopify comes with unique challenges, particularly in payment processing. Since Shopify Payments does not support CBD sales, finding a high-risk payment processor is essential. Additionally, businesses in this industry must comply with strict regulations to avoid legal and financial issues.

Many banks and payment processors classify CBD businesses as high-risk due to regulatory uncertainty and financial concerns. Some of the primary reasons include:

• Regulatory Uncertainty: Laws surrounding CBD vary by region and frequently change.
• High Chargeback Rates: Customers may dispute purchases due to product expectations or misinformation.
• Banking Restrictions: Many banks are unwilling to work with CBD businesses due to perceived risks.
• Reputational Concerns: Some financial institutions avoid the CBD industry due to its association with cannabis.

Since Shopify Payments does not support CBD transactions, you’ll need a third-party high-risk payment processor that specializes in CBD businesses. By choosing a payment solutions provider such as Altix Payments, you can ensure seamless transactions, reduce the risk of account holds or terminations, and maintain compliance with industry regulations.

To operate legally and secure a reliable payment processor, your CBD business must meet specific legal requirements. Ensure you have the following:

• Proper Licensing: Verify that your business complies with federal, state, and local CBD laws.
• Lab Testing & COAs: Provide Certificates of Analysis (COAs) proving that your products contain legal THC levels.
• Transparent Labeling & Marketing: Clearly list ingredients and avoid making medical claims about CBD products.
• Age Verification: Some jurisdictions require customers to be 18 or 21+ to purchase CBD products. Implement age gates and ID verification to remain compliant with regional laws.

Chargebacks and fraud are common concerns for high-risk businesses. Implementing fraud prevention strategies will help protect your store. Consider the following best practices:

• Address Verification System (AVS): Reduces fraudulent transactions by verifying billing addresses.
• Clear Refund Policy: A transparent return policy minimizes disputes and increases customer trust.
• Chargeback Alerts & Dispute Management: Services like Ethoca and Verifi help detect and prevent chargebacks before they escalate.

CBD regulations and payment processing policies change frequently. To avoid disruptions, ensure you are regularly doing the following:

• Reviewing payment processor terms and conditions.
• Staying informed on industry news and legal updates.
• Conducting compliance audits to prevent regulatory issues.

Selling CBD on Shopify requires extra preparation, particularly in securing a high-risk payment processor and maintaining legal compliance. By choosing a trusted payment provider, implementing fraud prevention measures, and staying up to date with regulations, you can set your business up for long-term success.

At Altix Payments, we specialize in providing high-risk payment solutions for CBD businesses. Let us help you navigate the complexities of payment processing so you can focus on growing your business with confidence.