Square Launches Payment Processing Program For CBD Businesses

(RTTNews) - Square Inc., a payment processor and point-of-sale solutions provider, said it has launched a CBD early-access program that will allow businesses in the U.S. to sell CBD products on its platform.

The company noted that the CBD products must be hemp-derived and have less than 0.3 percent tetrahydrocannabinol or THC.

Cannabidiol or CBD is a naturally-occurring cannabinoid constituent of cannabis. It is a chemical in the marijuana plant often used for medicinal purposes, and does not have the intoxicating effects like those caused by THC.

CBD derived from hemp was legalized in the U.S. last year, while THC-based products remain illegal at the federal level.

"In late 2018, the U.S. Farm Bill legalized CBD. We saw this as an opportunity to make our tools available to sellers in the CBD space, so they can start, run, and grow their business on Square," Square said in a blog post.

Square's move is expected to lower costs for small marijuana businesses that have struggled to grow over the past few years due to the difficulty in gaining access to financial products and services.

Square said it will charge 3.9 percent plus 10 cents per tap, dip, or swipe for each in-person transaction, while it will charge 4.2 percent plus 30 cents for each online and in-app transaction. Keyed-in, card on file, and virtual terminal transactions will be charged 4.8 percent + 15 cents per transaction.

Square also said it's payment platform will provide other services required to manage a CBD business, including payments, hardware, payroll and inventory management.