As banks have decided to focus on more traditional and mainstream businesses, the accessibility for merchants to find online merchant services for glass pipes has all but disappeared. Many merchants in the glass pipe industry have decided to remain as brick and mortar businesses while new businesses trying to start up online have been forced to forgo their plans after many unsuccessful attempts to establish an e-commerce merchant account.
The current legal landscape has been the determining factor for the lack of merchant account services available to wholesalers and retailers of glass pipe products throughout the USA. As of now, medical marijuana is still illegal on a federal level though many states have passed legislation allowing for the legalization of medical marijuana, recreational marijuana or both. While most banks in the merchant services industry operate using federal banking charters, the potential liability, fines and/or loss of their banking privileges due to violation of federal marijuana laws could be detrimental to the bank, and it is this reason why payment processors and banks have stayed out of the marijuana industry through today.
Though the glass pipes themselves are not illegal, the perceived risk of merchants offering marijuana or other illegal products through their stores is enough to scare banks and payment processors away from the industry. Sudden changes at the underwriting and risk department levels within the merchant acquiring banks can cause problems for businesses in the glass pipe industry, such as forcing limitations on online sales by establishing new monthly volume caps, creating mandatory reserves or termination of the glass pipe merchant accounts altogether.
As financial institutions change their goals, many times the risk policies of banks and payment processors have changed, leading many merchant services providers to change their policies and prohibit glass pipes as accepted merchant category, deciding to focus more on lower risk businesses that do not carry the perceived risk of selling illegal products. Prior to these changes in the underwriting of the glass pipe merchants, these businesses were able to contact a local merchant services provider to set up credit card processing, but now merchants need to work with a specialized payment processor.
The best solution for glass pipe businesses has been to work with a merchant services company that specializes in higher risk credit card processing or specifically tobacco merchant account services as a way to limit potential future problems with the acquiring banks or payment processing services. Having a partner that is familiar with the industry can help prevent any payment services problems, such as the loss of merchant services, that can dramatically affect sales and all but shut down a fully e-commerce glass pipe company.
Merchants looking for glass pipe credit card processing services can contact one of our merchant services representatives for more information about our glass pipe merchant account and glass pipe payment gateway services which were designed to help online businesses start up and help current businesses to continue growing their e-commerce sales.