
Head shops that sell products like dabbers, hookahs, water pipes, glass pipes, etc. may find it not only very difficult to obtain licenses but also to open a merchant account for any of their online ventures. The reason behind it is that head shops are a tricky business to deal with and they are considered high risk by credit card processors and banks.
Why Are Head Shops Considered High Risk?
Following are the key reasons why head shops are considered high risk:
1- The nature of head shops itself makes them a high-risk niche. Regulators don’t like their association with the drug paraphernalia industry.
2- Head shops primarily sell items that are related to smoking and cannabis industry. Although these products are not prohibited, there are certain regulations in place on how they are marketed and sold.
3- There is a high risk that the products being sold at head shops are used to smoke illegal substances. This creates challenges for such businesses looking to obtain a merchant account.
4- The head shops industry falls in a grey area. This is because the products they sell aren’t really illegal but the substances they contain or associated with sometimes put the industry in a tight spot.
5- The increasing restrictions and regulations imposed by lawmakers put uncertainty over the industry.
What Are the Advantages of a Head Shop Merchant Account?
The ability to accept multiple forms of payment is not something a business owner can ignore. A merchant account designed for head shops provides this benefit and many others, such as:
Reduced Risk: Head shop merchant account providers approve the inventory you stock, hence allowing you to process various types of payments without hassle. So, with the right processor behind you, you can minimize the risk of having your account flogged, locked, frozen, or terminated.
Chargeback Support: There is an increased risk of chargebacks when it comes to head shops and other such businesses. A high-risk merchant account protects them through its various anti-chargeback and anti-fraud features.
Increased Sales: You can significantly increase your sales by offering additional payment options to your customers.
What is Required When Applying for a Head Shop Merchant Account?
You may be asked to provide the following information when applying for a head shop merchant account:
Personal Information: You will be required to provide your name, social security number, phone number, and mailing address while completing your application. You will also be required to provide a government-issued ID or driver’s license.
Bank Account Details: Your personal as well as business bank account details are required in order to approve your high-risk head shop merchant account.
Online Presence: If your head shop has an online presence or it is associated with social networking sites, then you may be required to provide relevant details e.g. your site’s URL.
Business Model: Sharing your revenue plan or business model may also be required.
Getting a high-risk head shop merchant account is a great way to ensure that you continue conducting business without hassle, boost sales, and ultimately grow. Finding the right high-risk merchant account provider that supports your business is the key to make sure that you enjoy all of these benefits.
Merchant Account For Head Shops
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About The Author

Mark Sands, co-founder of High Risk Merchant Account LLC, an authoritative expert in the high risk merchant account space. Mark has decades of experience in the payment industry & enjoys writing on entrepreneurial related topics.
