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Paypal’s hard hit on the vaping industry: The reason why we are changing our payment method

2020 has been a challenging year for all of us. One would have thought that after COVID-19, nothing worse can happen to us, and people will start supporting each other both in private life and business.

However, this did not happen to the vaping industry in the last quarter of 2020. Paypal had a change of heart and banned all company accounts related to vaping products without any warning. Not just shops but manufacturers of e liquid, devices and all kind of accessories. To top all that, they froze the money within the accounts for a total of 180 days.

How the industry reacts to the PayPal ban

This is a tough hit on the industry and the businesses, especially next to the pandemic and restrictions. It is not just that losing access to Paypal will be an issue for vendors. But as David Gilbert from SuperGood e liquid said: “Cash is king and holding any small business’s cash is detrimental to their ability to run.”

Paypal is a world-wide dominant online payment service provider. Consumers prefer to purchase products online when assuring safe payment. Paypal was a perfect option for this. Sales generally grew by 30%-50% by being fast, secure and ensuring a convenient customer experience.

But Paypal has an issue with vapour products. They don’t believe that it is safe, and they suggest there is not enough scientific evidence behind it. I think there are plenty of scientific studies about vaping and being way better than smoking. A good example is the Cochrane Review.  

  • “Nicotine containing e-cigarettes are 70% more effective in supporting smokers to successfully quit than nicotine replacement therapy (NRT, like patches and gum) (confidence intervals give a range of 25% to 130% more effective)
  • Nicotine containing e-cigarettes are 70% more effective in supporting smokers to successfully quit than nicotine-free e-cigarettes (confidence intervals give a range of equally effective to 190% more effective.”

Public Health England also issued an update on their “Vaping in England: 2020 evidence update summary”. In this they state that vaping with other support can increase the chance of stopping smoking successfully. It is interesting to read, and I suggest PayPal read it too.

I understand that a payment service provider can decide who to accept and who they do not wish to cooperate with. But to freeze their accounts and incomes is just unacceptable.

Take action now and support the industry

There are no clear rules or mentions of tobacco products in Paypal’s user agreement, only about cigarettes. But we all know that this is not the same. Paypal’s Acceptable User Policy page includes “Providing file sharing services or access to newsgroups; or selling alcoholic beverages, non-cigarette tobacco products, ecigarettes or prescription drugs/devices” are bound to a pre-approval. But from previous experiences, this approval is not given. If you wish to try, you can do so by e-mailing them your contact information, business website URL, and brief business summary to aup@paypal.com.

If you decide to take action, don’t gape if you get a response like this:

“Under PayPal’s Acceptable Use Policy, PayPal may not be used for the sale of e-cigarettes, including e-liquids containing Nicotine, without pre-approval. Unfortunately, we are unable to offer pre-approval for you at this time; this is due to complex legal and payment industry requirements related to e-cigarettes.”

As a result of this event, we at Vapestorm.co.uk will be changing our payment method. We wanted to make sure that our customers use a service that they know and feel comfortable with; therefore, we decided to use Sage, a safe, effective, and user-friendly online payment service provider.

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