Merchants selling pure, unadulterated kratom face many challenges. Kratom is still considered an emerging market in the U.S. While it has been used safely for centuries in its native countries, it has only been available in America for a couple of decades. And it has only become well known and widely marketed over the more recent years.
There is pressure from the FDA to list kratom and its compounds as a Schedule 1 drug on the List of Controlled Substances. There’s inconsistent regulation between states, and in some states, it is illegal to sell kratom. There’s also varying public perception and misinformation abounds.
Honest and legitimate kratom merchants are also affected by unscrupulous companies that tarnish the industry. These bad actors resort to questionable practices, including adding dangerous and illegal substances to the natural product.
Accepting payments for kratom is one of the greatest challenges
To make things more difficult, many processors won’t support a merchant account to accept payments for kratom. For all the reasons listed above and more.
Kratom is most often sold online through ecommerce merchants. Nutraceuticals and supplements are considered high risk for payment processors. They also tend to have a high incidence of credit card chargebacks.
High-risk industry, high chargeback ratios, lack of oversight or inconsistent regulations, these are all things most traditional banks and processors shy away from. And this is what makes a reliable and affordable kratom merchant account hard to find.
As a kratom merchant, you’re already up against enough challenges. It's more important than ever to partner with a merchant account provider that can help you handle those challenges. That means you must have an experienced and trusted high risk merchant account provider.
U.S. Regulations and FDA opinion
In the U.S., kratom is still legal at the federal level. Kratom does not hold a place on the List of Controlled Substances. However, the FDA sent a recommendation to the DEA to add kratom as a schedule 1 drug on the List. After reviewing data, the DEA withdrew its notice of intent to schedule. Currently, the FDA has not approved kratom, or kratom derived products, for any uses for sale within the U.S.
However, 6 states have passed bans on the sale of kratom within their states. Alabama, Arkansas, Indiana, Rhode Island, Vermont, and Wisconsin made kratom illegal in 2016.
Without regulation, ensuring only safe and unadulterated products are available isn't possible. Problems with products in the market include mislabeled ingredients, lower than claimed potency levels, and products including dangerous drugs like fentanyl, morphine, and heroin. 
Proponents of kratom continue to advocate against scheduling of kratom to the List of Controlled Substances. Instead, proponents believe regulation for production, sales, marketing and labeling will ensure the safety of products for consumers.
The Kratom Consumer Protection Act aims to protect consumers by ensuring Good Manufacturing Practices, requiring only pure, unadulterated kratom, introducing truth in labeling and including age restrictions.
This type of regulation ensures consumer safety by making sure products meet a certain level before entering the distribution lines.
To date, 6 states have taken initiative and passed the KCPA, including Arizona, Georgia, Nevada, Oklahoma, Oregon, and Utah. Kratom remains unregulated in all other states.
Kratom legality in other countries
Abroad kratom is greeted with mixed acceptance. In several countries, including Australia, New Zealand, Ireland, and parts of Europe, kratom is a scheduled drug. The UK banned the sale, import, and export of kratom in 2016.
And in Canada, marketing of ingestible kratom is not allowed. However, marketers are allowed to offer other forms of kratom, such as incense.
Indonesia chose to make kratom illegal in 2019, but set an effective date of 2024 to allow farmers a chance to switch to alternative crops.
Thailand, however, has a completely different take on the plant. The country legalized kratom for medical uses in 2018, then went on to fully legalize kratom and remove it from their list of narcotics in 2021.
A reliable kratom merchant account is achievable with an experienced provider
Currently, there are very few processors that will knowingly provide a domestic merchant account for kratom payment processing.
Merchants selling kratom must be diligent when opening a merchant account to process payments. It is still a common practice to mis-code a merchant to obtain an approval for a merchant account. This practice serves no one and leaves the merchant at risk for getting their ability to accept payments shut down.
There are also processors who will offer an offshore merchant account to kratom merchants. While offshore payment processing is an option, this solution comes with its own risks and limitations.
Many payment processors will say they can offer a kratom merchant account but they are not truly prepared to handle the risks. For merchants to obtain a reliable solution for kratom sales, they must work with a provider that specializes in high-risk services.
Only an experienced high-risk merchant service provider understands the industry and has the business model needed to handle it.
Not only does the merchant account provider need to have a track record of serving high-risk industries, they should also have extensive experience serving both nutraceutical companies and eCommerce merchants.
At Bankcard International Group, we specialized in high-risk merchant accounts. And we have decades of experience servicing high-risk business sectors of all types.
Hard to place businesses deserve a legitimate solution they can rely on with fair and transparent rates. High-risk merchants need more care than traditional merchants. They require a merchant service provider with the tools to help them manage their unique challenges. We’re prepared to meet those needs.
At B.I.G., each account is looked at individually by our own in-house underwriting team. This allows us to place businesses with the solution that is the best fit for their needs. And it helps to ensure merchant account approval. We never mis-code merchants. We don't have to. We practice complete transparency with our banking partners.
Our domestic payment processing solution means merchants don’t have to wait for their funds or endure expensive transfer fees. And customers don’t have to deal with e-wallets or crypto work-arounds. They just get to pay the way they want to.
Our secure and 100% PCI Compliant gateway makes it easy. And if merchants want to accept cryptocurrency, we have one of the best solutions on the market.
Once approved, merchants protect their business with intuitive fraud detection and prevention tools. Our robust chargeback management software helps keep chargeback ratios down and protects your bottom line.
It's through this dedication that we can offer reliable solutions to our merchant partners. And allows us to focus on providing personalized service and transparent rates that lead to lifelong partnerships.
If you're ready for a reliable high-risk merchant account, Bankcard International Group is ready to provide that for you. When you partner with B.I.G., you’ll have all the tools you need to accept kratom payments reliably.
