Tobacco Merchant Account

If you want to sell tobacco online, you need vibrant merchant account solutions.

Whether you’re working with cigarettes, cigars, or tobacco products in between, a merchant account is considered “necessary equipment” in the era of eCommerce.

But it can be hard for a tobacco business owner to get a merchant account. Why? Because they are considered to be “high risk.”

In short, tobacco businesses are high risk because of a few different reasons. For one, they are subject to strict government regulations, any of which can change at a moment’s notice.

Another reason is that tobacco sales can often be complicated. And add to that the overall higher frequency of chargebacks in the industry, and it’s no surprise they’re labeled in this way.

A chargeback happens when the holder of a credit card disputes a transaction with the bank that issued the card. If the business closes for any reason, the bank is left to cover the transaction. And banks hate paying money out they don’t have to!

Merchant accounts allow business owners to take debit and credit cards for payment. You want to make sure you can accept these cards, because fewer people are using cash, or even checks.

But since your tobacco business is subject to high risk rules, you might have difficulty obtaining a merchant account.

And that’s where Easy Pay Direct comes in! We’re experts in setting up merchant accounts for tobacco and other high risk businesses.

Easy Pay Direct works with an array of banks to ensure you get the right merchant account for your businesses. In case you’ll be working with card-not-present transactions, we’ll show you how to use the integrated online payment gateway.

If your business has a physical presence, we can furnish you with the Clover line of advanced point-of-sale systems, or just some high-quality credit card terminals.

And here’s the best part. Easy Pay Direct has the highest approval rate in the industry! So even though your business is high-risk, you’re sure to get approved for the best merchant account around.


Although it sounds extreme, it is very easy to get labeled high risk by the financial industry. In the case of tobacco sales, there are a few reasons for this.


Anytime a credit card transaction takes place where the card is not physically present, it is known as a card-not-present payment. These types of payments increase the risk of fraud as the card cannot be physically accounted for. This applies to any business that accepts online payments, including the tobacco industry.


There are a lot of complicated laws surrounding tobacco that may vary from state to state. For example, in 2019 the FDA changed the minimum age to buy tobacco from eighteen to twenty-one. Most states have updated their local restrictions accordingly, but laws surrounding this issue are known to change at any time.

This is one of the main reasons that tobacco sales get automatically labeled as high risk by financial institutions.


Chargebacks happen when a customer disputes a charge on their credit card statement. This is more common in some industries including those that involve selling age-restricted products like tobacco. The right merchant account provider can help reduce instances of chargebacks.


When it comes to a high risk business like tobacco sales, a merchant account that specializes in high risk industries is ideal.

The right merchant account will enhance your security, decrease instances of fraud and chargebacks, and charge a fair price.


Your tobacco merchant account should be PCI compliant which means it has met all security standards put forth by the payment card industry. These standards ensure your customer’s credit card data is secure and instances of fraud or hacking would be rare or nonexistent.


Every merchant account charges a fee per transaction. This is usually a percentage of the transaction amount. Sometimes an additional fee is added on top of that. In addition, some other fees that may come with an account include a setup fee, PCI compliance fee, statement fees, and early termination fees.

For the fairest and open pricing, choose a contract with a few added fees. Many merchant accounts offer variable rates instead of fixed rates. While fixed rates can be beneficial in better predicting expenses, variable rates have more potential to save you money in the long run, especially with high-volume industries.


Your merchant account can help decrease instances of chargebacks. One way to do that is to include clear statements on receipts so customers know what it is they paid for.

Another way is to reach out to customers to ensure they are satisfied with the product they received. The bottom line is, if your customers are happy with your product and service, they are very unlikely to dispute charges from you.


Payment aggregators such as Stripe, Paypal, or Square are very popular with new businesses because of their simplicity. They offer a flat-rate transaction fee and near-instant approval.

However, because payment aggregators do not require an involved application process, they often know next to nothing about your business upon signing up.

They are extremely sensitive to any behavior on your account that could be considered high risk. This includes high transaction volume or chargebacks. Accounts with two many instances of chargebacks can have their accounts frozen or terminated without notice.

In addition, some payment aggregators are very selective about what businesses they take on. Before applying to any merchant account, check their guidelines to ensure you’re not in violation of any of their policies.

Because of the risks of using payment aggregators, it is recommended that most high risk businesses work specifically with merchant accounts that specialize in high risk industries such as Easy Pay Direct.