If you’re thinking about launching a website that sells products with regulatory issues like kratom, then you may have problems finding a payment processor. Although kratom is legal at the federal level, there are certain states and cities that ban this herbal supplement. As banks tend to be risk-averse, they will likely reject your application for a merchant account. So, what should you do?
Set Up Bitcoin Payment Processing
Before you start your search for a payment processor, you can start collecting bitcoin and other cryptocurrencies. Keep in mind that crypto is volatile, so you may want to convert those funds to fiat currency quickly. That said, if you’re selling numerous types of kratom on your website, then you’ll want to give people this payment option. There are third party bitcoin processors, and some of them will work with you, for a fee. However, you can cut down on your fees by setting up a Bitcoin processing server, using open-source software like BTCPay. This will require some technical know-how, so you might want to hire a professional web developer to set this up for you.
Accept ACH Transactions
There are many payment processors that will process ACH transactions for you. ACH transfers tend to be lower risk for the parties involved, so approval tends to be easier. The challenge here is that you will need to wait for the digital check to clear before funds are available. This requires you to keep track of old orders, sometimes for several weeks, before you ship product to your customers. As such, you could have some cancellations due to the slow service. You could ship early, but you risk losing the funds if the check doesn’t clear.
Try a High Risk Merchant Account Overseas
This is the riskiest way to process transactions. However, it also tends to convert the best. Most people won’t want to deal with the hassle of making crypto or ACH payments. So, if those are the only ways you collect funds, you could have low conversion rates. Adding credit card processing will help substantially. The problem is that US merchant processing companies often will not process kratom transactions. You may end up going through a bank in Africa or elsewhere. They will typically hold around 10% of your money in escrow before releasing funds to you, in addition to their high fees. If you pick the wrong bank, you could lose all of your funds. So, be careful with this method.
Get Familiar with the Law
The FDA is limiting imports of mitragyna speciosa into the US, and has seized property from herbal remedy companies that have made medical claims about the product without their approval. Therefore, it is important to learn the law, and the risks associated with selling kratom before you invest in this industry. The content on your website must be free from any false advertising, or medical claims that are not backed by scientific studies. You must also avoid shipping the product to jurisdictions where it is prohibited. Read the news about the history of crackdowns, so that you understand what could happen in the future.
Starting a Kratom ECommerce Website Ain’t Easy
There is a lot of demand for this herbal remedy. It is touted to help people with their stress and anxiety, and it is even reported to help people get over their opioid addiction. It’s a lot of work, and it’s risky to get into this business. But, if you want to try it out, then consider the steps above.