Starting and growing any business is a tricky task but the pain points within the cannabis industry are particularly numerous. Many high street banks won’t touch you with a 10ft barge pole and ubiquitous payment handling systems like PayPal and Stripe have a strict ‘no cannabis business’ policy. It seems then that cannabis businesses have a much higher barrier to entry than other business sectors and many would-be business owners and entrepreneurs underestimate how difficult it can be to get all the ‘boring stuff’ set up. Even for existing cannabis businesses, the use of dodgy payment processors and unregulated banks can put your hard work in jeopardy.
Maybe you’ve had a concept for months and invested heavily into branding and marketing. Maybe your product is literally sat there ready to go and the only things left to do are to sort out a business bank account and someone to handle transactions. This scenario is so common for budding CBD and cannabis businesses and issues at this stage can hold progress up for months. Some businesses try their luck by signing up to PayPal or high street bank accounts by being selective in how they describe their business i.e. leaving out the part about cannabis! Don’t do this! If the banks or payment processors find that you have been deceptive, they will shut you down at the flick of a switch and may not release your funds.
Numerous payment processors claiming to be the ‘next big thing’ in cannabis payment handling have been investigated and shut down over the last few months leaving many CBD businesses in turmoil and looking for alternatives. Even respected fintech banks like Anna which have fairly lax onboarding processes are not immune to being shut down or restricted overnight. Having a solid, reputable bank handling your money and a reliable and compliant payment processor handling transaction’s is absolutely critical. Issues with either of these can put an immediate halt to your business.
The best way to avoid issues related to banking, payment processing and even insurance is to speak to a business who has learnt these lessons the hard way and have developed iron-clad solutions. The CBD Group is best known for being the first purpose-built cannabis-product manufacturer in the UK but aside from our manufacturing capability, we provide unmatched support for existing and new CBD brands who need quick and reliable help with banking, payment processing and insurance. We can help even if you don’t manufacture with us.
We had a very tough experience setting up in the world of cannabis, so you don’t have to.