With a new year comes new sets of regulations and guidelines. As a business owner, you’re constantly tracking the pulse of how new regulations will impact your business, and BankCard is here to help.
About a third of U.S. states have legalized recreational marijuana use (Arizona, Mississippi, Montana, New Jersey, and South Dakota being the most recent additions), which prove there have been great strides in lifting marijuana and cannabis restrictions. And with more conservative states like Arizona, Mississippi, and South Dakota legalizing marijuana use, the push to legalize on a federal level is getting stronger.
This momentum initially gained speed starting in November of 2012 when Colorado and Washington were the first states to legalize recreational marijuana. Since then, 16 states have made marijuana fully legal, while the majority of the country has made medical marijuana and CBD products legal. There are only three states with no access: Idaho, Nebraska, and Kansas.
There has been great progress to slowly unsnarl cannabis and marijuana from federal red tape, including the most recent passing from the House to decriminalize marijuana. With all of this amazing development, the overall outlook of cannabis and cannabis products is starting to look more positive. And if you’re in the CBD industry, this is great news. But with all of this progress, what should you anticipate for payment processing and CBD products in 2021?
Growth of the CBD Industry in 2021
2021 will see the greatest growth in the CBD industry to date. If current trends continue, we’re projecting the CBD industry to expand by over $1 billion next year alone. But what does this mean for your CBD business? To put it simply, a lot.
We’ve seen time and time again, regulations, changes, and trends happen in particular industries and those companies well-equipped can hit the ground running with seamless transitions while competitors may be playing catch-up.
One industry you could draw from for comparison is gambling. Gambling and gaming are still regulated by state governments, even though various forms of gambling are legal under Federal law. Nevada was the first state to legalize gambling in 1933, followed by other states legalizing gambling to take place in commercial casinos, tribal casinos, bookmaking, lotteries, etc. In 2017, the total legal gambling revenue was $84.65 billion.
The CBD industry, albeit a budding venture, is on track with the gambling timeline, but at a more rapid pace. In this age of technology, ideas and products can come alive at a quicker rate, making the growth potential higher.
Regulations for selling CBD products in the United States vary notably from state to state. It’s important to regularly review the new announcements on the FDA’s site so you are up-to-date on new findings and regulations soon to be implemented.
Predictions for the CBD Industry in 2021
Further FDA Regulations
Like most wellness products, the early stages of manufacturing and selling aren’t overly wrought with FDA regulations regarding how you can advertise products. It’s predicted that the FDA is expected to release more regulations to block companies from falsely claiming to “cure” illnesses, but rather promote its benefits for a variety of ailments.
Research done by the National Health Council indicated that 40% of Americans suffer from a chronic illness with an estimate that the percentage will rise to 46% of the population by the end of 2020.
As more of the American population becomes frustrated that their conditions are either getting worse or not improving, more will turn to CBD products to help minimize symptoms and provide a remedy to conditions without turning to pharmaceutical drugs.
More Production, Fewer Brands
Broadening the space in which CBD and cannabinoid products can be consumed means that consumers are looking for the best of the best and in larger quantities. It’s known that the best CBD oil is harvested from domestically-grown hemp plants, currently under sharp scrutiny – which many CBD companies may not be able to keep up with. As the FDA strengthens their standards, there are predictions that there will be a massive drop in brands.
There is also the possibility that the companies that can stick it out may reach out to some of the top manufacturers to start a white-label partnership in which the manufacturer would provide the product and the company will turn it over for a profit with their label.
Increase in Investments
There is no denying that the CBD and cannabis markets are exploding, and it still has more room to grow. Looking at some of the top-performing stocks, you will find numerous CBD companies.
The expectation is that the market growth of the CBD industry could exceed 22% per year within the next few years. A wise investment option for many top corporate players and individual traders.
With more production and the addition of legalizations in Arizona, Montana, New Jersey, and South Dakota, there will be tens of thousands of jobs relating to the cannabis industry added to the market. Some high-demand fields will include retail, manufacturing, cultivation, finance, and legal.
New Retail Territory and Products
Right now, there are a slew of products in CBD marketing like oil, anti-anxiety tinctures, capsules, edibles, and topicals. With an increase in production, funding, and individuals in the industry, there are sure to be newer products hitting the shelves in 2021.
CBD products have already entered into the food and beverage, pet care, spa, restaurant, and cosmetic markets and there will be sure to be growth into other businesses as well.
Further Into the Future
Looking forward to the 2022 midterm elections, advocates in Arkansas, Florida, Missouri, North Dakota, Ohio, and Oklahoma are lobbying to get recreational marijuana on the ballot. In Idaho and Nebraska, there is also a push for medical marijuana to become available for residents.
With many more states looking to join in the legalization of cannabis products, regulations and changes will be happening quickly. Partner with BankCard Services to help you navigate the transitions and stay ahead of the curve.
How BankCard Services Can Help with a CBD Merchant Account
Finding the right payment processor that specializes in high-risk merchant accounts is essential during these changing times. BankCard Services understands the CBD industry and the regulations involved.
We always stay informed in the industries our merchants are involved in, which in the end will allow you to save your time to do what you want to do: scaling and developing your business. We can even help CBD businesses in the following ways:
- Assist businesses in minimizing chargebacks with management tools and chargeback protection.
- Help businesses fight chargeback disputes.
- Aid businesses in guarding against fraud so fraudulent chargebacks aren’t holding your profits down.
- Offer transparent pricing without surprise fees and disciplinary monthly payments.
- Allow businesses to accept all major credit cards.
- Offer services to help CBD businesses accept payments in stores and online.
BankCard Services is committed to offering transparency that business owners can understand and rely on. This includes expert knowledge from specialists who understand the services we offer and how those services can benefit your business. Not to mention our affordable rates that won’t cost your business an arm and a leg to accept credit card payments.
Contact BankCard Services today to schedule an appointment with a BankCard specialist.