What is a high risk merchant account?
A high risk merchant account is a credit card processing service for businesses in industries that are deemed "high risk." Since dispensaries are considered high risk agencies, they are not eligible for a standard merchant account. A high risk account allows you to still process credit cards. However, the merchant service opens the account on your behalf.
Businesses that are considered high risk:
- Businesses that may not be registered with local regulatory agencies
- Industries that are considered high risk: downloadable software, gaming, health shops, dispensaries, e-cigarettes, real estate, etc.
- Businesses with low volume of sales and are therefore unable to afford fraud screening tools or make payments to 3rd party processors.
Cost for high risk accounts
When compared to standard merchant providers, high risk credit card processing is more expensive in terms of transactions fees and charges. This is because merchant credit providers assume the risk for credit processing. Because the dispensary industry has higher risk associated to it in terms of legislation inconsistencies when it comes to marijuana, there will be higher fees.
Do You Need a High Risk Merchant Account?
With the extra costs and time invested into a "high risk" merchant service you might consider running an all cash operation. Unfortunately, running your business this way can dramatically cut into your bottom line.
The Benefits of Credit Card Processing for your Dispensary:
- Because credit and debit cards have become more popular not accepting them can limit the amount of business you're able to accept.
- While some dispensaries have the convenience of an in business ATM, some customers may be punished with penalties for not using their bank's ATM. Having the capacity to handle credit and debit cards lends legitimacy to your shop.
- There's no more lost revenue on a customer not having enough cash for an additional product they had not intended on buying before coming into your shop. Limiting the amount they can spend to only the cash in their wallet, means less of an opportunity for you to upsell.
- The convenience of credit card processing in your dispensary increases customer loyalty. Customers appreciate the convenience of being able to use whichever payment method they already have in their pocket without too many extra steps. Knowing that they get that service at your dispensary makes your business the more appealing choice.
- Credit card processing gives you the freedom to expand. The dispensary business is ever changing and with Colorado dispensaries surpassing $5 million in sales since the law came into effect on January 1st 2014, we don't see business slowing down. Do yourself a favor and give yourself the option of expanding your business. Credit card processing allows you to expand your business to online sales, delivery, drive-thru services along with many more expansion options.
Cafe Cartel's Merchant Service for Dispensaries
Being in the dispensary business requires a lot of navigation and jumping through legislative hoops. We make sure that your dispensary point of sale is fully equipped with all the tools you need for your dispensary including reliable merchant services.
Dispensary Client Testimonial
One of our dispensary clients knows all too well the problems that can arise when it comes to finding a merchant service that serves "high risk" industries, and shared his story with us:
"I was having trouble getting approved for a merchant account on my own. We know of online processors refusing service and terminating accounts without notice to other dispensaries. We then thought that running an entirely cash-based operation was our only option, but didn't like how limiting that would be for our patients.
We did some research online and found Cafe Cartel through MMJ Business Daily. We couldn't be happier with our point of sale and merchant service. Set-up was easy, and the software is geared toward dispensaries so the patient management and inventory tracking was pretty intuitive. Most importantly we've had no problem with our payment processor, the convenience of accepting credit cards has made a huge difference to our business."
Being a partner in the MMJ dispensary business we understand the difficulty of getting approved for a merchant account. Luckily, we've done the homework for you, and include a merchant service already approved for your dispensary.
Cafe Cartel's Dispensary Merchant Services Provides:
- Credit card processing for all major cards
- We can do credit card processing nationwide
- "High risk" credit card processor
- Fraud prevention
- Customer and technical support services