Cannabis news sites are tracking the evolution of the marijuana market and providing a valuable service to both consumers and industry insiders, but many marijuana publishers are still having difficulty monetizing their efforts. Despite recreational marijuana now being legal in some form in 33 states and Washington D.C., many cannabis magazines and news publications that cover the industry are being prevented from using traditional U.S. banks because of federal regulations.
Although the cannabis industry has grown by leaps and bounds over the past decade, few domestic payment gateways are willing to give cannabis news sites an account. Part of the issue has to do with the business names that cannabis news publishers are choosing. Many payment gateways in the U.S. will refuse payment for perfectly legal business services if “cannabis” or “marijuana” is found in the title of the product or service being sold.
One of the clearest examples of how this issue can impact an organization involves California NORML, a non-profit, membership organization dedicated to reforming California’s marijuana laws. California NORML publishes a newsletter and offers legal and consumer health advice through a popular blog. However, the site was blocked from working with PayPal because it’s part of the marijuana industry. Paypal claimed that by charging physicians and collectives a yearly listing fee to be included in its online directory, California NORML was violating its Acceptable Use policy.
California NORML is just one of a number of cannabis organizations that has dealt with payment issues. PayPal is notoriously difficult to use for cannabis companies, including cannabis news sites. PayPal’s Prohibited Activities policy bans services for transactions that “involve” drug paraphernalia in any way.
Cannabis news sites around the country have struggled to find payment gateways to use as they build up their subscription, membership, and advertising programs. While there are around 40 banking institutions that cater to the cannabis industry, their services are limited, and not all of those institutions work with cannabis news sites specifically.
What this means for news publishers is that they may have trouble collecting payments for online subscriptions, memberships, and self-serve directories and classified ads, simply because of their industry niche. This is true regardless of whether the publication operates in a state where cannabis is legal.
These issues aren’t just reserved for online magazines and news sites that focus solely on the cannabis industry. Health and wellness bloggers can run into the same problems when they write about the benefits of marijuana or CBD. When health blogger Orleatha Smith wrote about the health benefits of CBD on her blog, her payment processor pulled her merchant account. That left Smith unable to accept payments for other products that she was selling through her website, and ultimately led her to create InclusivePay, a company that specializes in high-risk merchant accounts.
Payment gateways perform a vital role when it comes to processing and authorizing payments between buyers and sellers, or readers and publishers. Payment gateways authorize credit card payments. Without a payment gateway, it can be incredibly difficult for cannabis news sites to sell subscriptions and memberships, or sell paid directory listings.
Payment gateway options for cannabis news sites do exist, but they aren’t easy to find. Publishers with news sites focused specifically on marijuana and the cannabis industry usually have the most success working with payment gateways developed for high-risk industries.
Companies like PayDiverse specialize in placing high-risk businesses with qualified banking partners. Even though cannabis news sites don’t seem like they should be considered “high risk,” they often are viewed that way in the eyes of payment gateway companies and payment processors.
Another company that works with cannabis news sites is eMerchantBroker (EMB). EMB works with high-risk businesses, and it offers a unique credit card processing platform and payment gateway built specifically with those businesses in mind. EMB’s platform integrates through multiple gateways and offers “intelligent” transaction routing.
Naturepay is a payment processing solution for businesses in the cannabis industry. The company provides its clients with an online gateway with proprietary marijuana software that includes all credit and debit card transactions.
Azura Payments is another company that helps businesses in high-risk industries get—and keep—payment gateways and payment processing accounts.
PayKings runs a similar service, offering a high-risk payment gateway and direct network of more than 20 banks.
Do you run a cannabis news site that has dealt with payment processing issues? Tell us about your experience and which payment gateways you are working with at your publication.