Vape and e-cigarette merchant accounts are typically considered high-risk because of the industry they belong to. Payment processing companies worry about providing merchant services to industries with a high risk of fraud, high chargebacks, or other issues. The following factors are the reasons e-cigarette merchant accounts are known as high-risk.

Regulations and Worries About Future Legal Implications: Payment processing companies worry about future health risks and lawsuits from those who use these products. This means the e-cigarette industry is automatically considered high-risk.

High Risk of Chargebacks: Another factor that determines high-risk industries is their chargeback rate. Merchant services providers are wary of chargebacks because they are costly to process. A vape business often sees high chargeback rates, meaning that a retail vape merchant account may be considered high-risk.

New Merchants: As the e-cigarette industry is relatively high-risk, many cig and vape companies are started by new merchants without a payment history. This type of company is automatically categorized as high-risk regardless of industry. They’ll need high-risk payment processing to accept credit cards.

Being labeled as a high-risk merchant necessitates partnering with a payment processor experienced in high-risk accounts. Avoid disruptions by choosing Crazy Merchant, a leader in high-risk merchant account solutions for the vape industry. We have the expertise to put together custom e-commerce payment solutions for your e-cigarette business.