What kind of merchant account is needed for a tobacco business?

Most tobacco businesses need a high-risk merchant account. Card networks place tobacco sellers under merchant category code (MCC) 5993, Cigar Stores and Stands. They also add registration rules for tobacco sales made online or by phone. AllayPay sets up high-risk merchant accounts, so you hold your own MID.

Can tobacco shops sell products online?

Yes, with the right merchant account and payment gateway. Online tobacco sales may need Visa or Mastercard registration before you process. You also need to confirm buyers are 21 or older and ship with a carrier that accepts tobacco. Learn more about online merchant services.

How can tobacco retailers verify age in online sales?

Check age at checkout and collect an adult signature at delivery. Federal law bans tobacco sales to anyone under 21. California also requires a signature from someone 21 or older to receive a tobacco delivery. For PACT Act products, such as little cigars, sellers must use shipping methods that check age.

Are there payment processing systems that integrate with tobacco retail POS systems?

Yes. AllayPay provides hardware and software integrations, from POS to payment gateways. Our POS systems and integrations, such as Clover POS, work at the counter, in the humidor, or at the lounge bar.

Can tobacco merchants accept digital wallet payments?

It depends on the wallet and where you sell. Apple Pay prohibits websites that sell tobacco. PayPal requires approval before you accept payments for cigars and other non-cigarette tobacco. Ask our specialists which wallets fit your business before you add them.

How can tobacco businesses handle high chargeback risks?

Start with clear store policies and tracked shipping. When a buyer says an order never arrived, Visa looks for proof of delivery, tracking, and a signature when available. For online orders, 3D Secure adds an extra identity check at checkout. Our payment processing specialists stay with you after onboarding if questions come up.

What are the typical processing fees for tobacco merchants?

Fees depend on your sales volume, sales channel, processing history, and bank. High-risk businesses often pay more than low-risk businesses. Tobacco merchants that sell online may also have card brand registration fees. Contact us for a quote based on your business.

Can cigar lounges offer membership billing through their payment processing system?

Yes. Payment gateways that AllayPay integrates with, such as Authorize.net and NMI, support recurring billing for memberships and cigar clubs. Show members the price, billing date, and how to cancel before they sign up.

How quickly can tobacco merchants access funds from sales?

Funding time depends on your bank and account setup. Contact us for current funding times for tobacco and cigar merchants.

Can tobacco retailers provide installment payment options for high-end products?

Some processors work with consumer financing companies to offer installment plans for high-ticket items, like humidors or boxes of premium cigars. Ask our specialists whether a financing option fits your business.

What security measures should be in place for online tobacco sales?

Use a secure payment gateway, encryption, and PCI-compliant payment tools. Mastercard requires every merchant that stores, processes, or sends card data to follow the PCI Data Security Standard. You also need to follow federal and state rules for online tobacco sales, such as age checks and delivery rules.

What documents do I need to submit my application today?

You will need the following documents to get started: Driver’s License OR Government ID Voided Check OR Bank Letter with Routing and Account Number Last 3 Months Business Bank Statements, IF available Last 3 Months Processing Statements, IF available State tobacco retailer license for each store location PACT Act registration (ATF Form 5070.1), IF you ship cigarettes, little cigars, roll-your-own tobacco, smokeless tobacco, or e-cigarettes across state lines Signed carrier tobacco shipping agreement, IF you ship orders

Do I need card brand registration to sell cigars online?

Often, yes. Mastercard requires acquirers to register merchants that sell tobacco products online or by phone. Visa requires registration for cross-border, card-absent tobacco sales before the first transaction. These rules target sales made online or by phone, not in-store sales.

What are the website requirements for tobacco and cigar companies?

Businesses selling tobacco and cigars online should plan for the following: Age Requirements: Sell only to adults 21 and older, as federal law requires 21+ age verification BEFORE entering the website Age verification at checkout Adult signature at delivery where state law requires it, such as California Shipping Requirements: Ship only with carriers that accept tobacco. FedEx does not accept tobacco shipments, and UPS requires a signed tobacco agreement UPS does not ship cigarettes or little cigars to consumers For PACT Act products, register with ATF, report sales to state tax officials, and use age-verified delivery Product Requirements: Follow state flavor rules. California retailers may only sell unflavored products on the Attorney General’s approved list Do not ship into states or cities where a product is banned Website General Requirements: Terms and Conditions, Privacy Policy, Shipping, Refund, and Returns Clear product descriptions and prices Clear terms for cigar clubs and subscriptions before checkout

Tobacco Payment Solutions | AllayPay Merchant Services

Tobacco and Cigar Credit Card Processing

We provide merchant services for businesses that sell cigars, pipe tobacco, and other tobacco products to adults 21 and older. Banks and card networks review tobacco sellers closely, especially when they sell online. Our payment processing specialists walk you through each step, so you can focus on your humidor, your lounge, or your online store.

Tobacco & Cigar Businesses We Support

Our tobacco payment processing tools work for shops, lounges, and online sellers.

Cigar Shops and Tobacconists
Cigar Lounges
Online Cigar Retailers
Pipe Tobacco Shops
Cigar Clubs and Subscription Boxes
Cigar Manufacturers and Importers
Hookah and Shisha Tobacco Retailers
Tobacco Wholesalers and Distributors
Smoke Shops Selling Cigars
Cigar Accessory Sellers (Humidors, Cutters, Lighters)

Seamless Integrations

View All Integrations →

Trusted Online Tobacco Payment Processing

Guaranteed savings on tobacco & cigar merchant accounts.

Fast approvals and best point of sale systems available.

AllayPay vs Others	AllayPay	Stripe, etc
High-Risk Expertise	ISO built for high-risk industries	Some restrict tobacco or require approval first
Account Stability	You hold your own MID	Higher risk of account termination
Underwriting	Human underwriting, real decisions	Automated systems, mass declines
Pricing Transparency	Clear, upfront pricing	Hidden fees and rolling reserves
Support	Specialists who stay with you after onboarding	Chat widgets and ticket queues
Chargeback Management	Proactive tools and guidance	Minimal support

Common Types of Tobacco and Cigar Merchants We Underwrite

Merchant Type	Description	Typical Sales Channel	MCC Code
Cigar Shops and Tobacconists	Retail stores selling cigars, pipe tobacco, and accessories	In-Store	5993
Cigar Lounges	Lounges selling cigars, lockers, and memberships	In-Store	5993 (Confirm with AllayPay)
Online Cigar Retailers	eCommerce stores shipping cigars to adults 21+	Online	5993
Cigar Clubs and Subscriptions	Monthly cigar boxes and memberships	Online (Recurring)	5993
Pipe and Hookah Tobacco Shops	Shops selling pipe tobacco and shisha	In-Store / Online	5993
Distribution and Wholesale	Wholesale supply to licensed retailers	Wholesale (B2B)	Confirm with AllayPay

MCC codes are examples and may vary based on business model, product, and acquiring bank requirements.

Ready to Take Your Tobacco and Cigar Business Further?

Get a payment solution built for your cigar shop, lounge, or online store, backed by specialists who stay with you.

Start Your Application Talk to an Expert

Why Tobacco and Cigar Businesses Choose AllayPay

High-Risk Experts

AllayPay is an ISO built for high-risk industries, and we know the rules tobacco sellers face.

Your Own MID

We set up merchant accounts, so you hold your own MID. Your MID is the account number that ties card sales to your business.

In-Store Hardware

Get POS systems and card readers for your counter, your humidor, or your lounge.

Dedicated Support

You get payment processing specialists who stay with you after onboarding instead of a chat widget.

Online Gateways

Connect your online store with software integrations and payment gateways.

Tobacco & Cigar Credit Card Processing FAQs

What kind of merchant account is needed for a tobacco business?
Most tobacco businesses need a high-risk merchant account. Card networks place tobacco sellers under merchant category code (MCC) 5993, Cigar Stores and Stands. They also add registration rules for tobacco sales made online or by phone. AllayPay sets up high-risk merchant accounts, so you hold your own MID.
Can tobacco shops sell products online?
Yes, with the right merchant account and payment gateway. Online tobacco sales may need Visa or Mastercard registration before you process. You also need to confirm buyers are 21 or older and ship with a carrier that accepts tobacco. Learn more about online merchant services.
How can tobacco retailers verify age in online sales?
Check age at checkout and collect an adult signature at delivery. Federal law bans tobacco sales to anyone under 21. California also requires a signature from someone 21 or older to receive a tobacco delivery. For PACT Act products, such as little cigars, sellers must use shipping methods that check age.
Are there payment processing systems that integrate with tobacco retail POS systems?
Yes. AllayPay provides hardware and software integrations, from POS to payment gateways. Our POS systems and integrations, such as Clover POS, work at the counter, in the humidor, or at the lounge bar.
Can tobacco merchants accept digital wallet payments?
It depends on the wallet and where you sell. Apple Pay prohibits websites that sell tobacco. PayPal requires approval before you accept payments for cigars and other non-cigarette tobacco. Ask our specialists which wallets fit your business before you add them.
How can tobacco businesses handle high chargeback risks?
Start with clear store policies and tracked shipping. When a buyer says an order never arrived, Visa looks for proof of delivery, tracking, and a signature when available. For online orders, 3D Secure adds an extra identity check at checkout. Our payment processing specialists stay with you after onboarding if questions come up.
What are the typical processing fees for tobacco merchants?
Fees depend on your sales volume, sales channel, processing history, and bank. High-risk businesses often pay more than low-risk businesses. Tobacco merchants that sell online may also have card brand registration fees. Contact us for a quote based on your business.
Can cigar lounges offer membership billing through their payment processing system?
Yes. Payment gateways that AllayPay integrates with, such as Authorize.net and NMI, support recurring billing for memberships and cigar clubs. Show members the price, billing date, and how to cancel before they sign up.
How quickly can tobacco merchants access funds from sales?
Funding time depends on your bank and account setup. Contact us for current funding times for tobacco and cigar merchants.
Can tobacco retailers provide installment payment options for high-end products?
Some processors work with consumer financing companies to offer installment plans for high-ticket items, like humidors or boxes of premium cigars. Ask our specialists whether a financing option fits your business.
What security measures should be in place for online tobacco sales?
Use a secure payment gateway, encryption, and PCI-compliant payment tools. Mastercard requires every merchant that stores, processes, or sends card data to follow the PCI Data Security Standard. You also need to follow federal and state rules for online tobacco sales, such as age checks and delivery rules.
What documents do I need to submit my application today?
You will need the following documents to get started:
- Driver’s License OR Government ID
- Voided Check OR Bank Letter with Routing and Account Number
- Last 3 Months Business Bank Statements, IF available
- Last 3 Months Processing Statements, IF available
- State tobacco retailer license for each store location
- PACT Act registration (ATF Form 5070.1), IF you ship cigarettes, little cigars, roll-your-own tobacco, smokeless tobacco, or e-cigarettes across state lines
- Signed carrier tobacco shipping agreement, IF you ship orders
Do I need card brand registration to sell cigars online?
Often, yes. Mastercard requires acquirers to register merchants that sell tobacco products online or by phone. Visa requires registration for cross-border, card-absent tobacco sales before the first transaction. These rules target sales made online or by phone, not in-store sales.
What are the website requirements for tobacco and cigar companies?
Businesses selling tobacco and cigars online should plan for the following:

Age Requirements:
- Sell only to adults 21 and older, as federal law requires
- 21+ age verification BEFORE entering the website
- Age verification at checkout
- Adult signature at delivery where state law requires it, such as California
Shipping Requirements:
- Ship only with carriers that accept tobacco. FedEx does not accept tobacco shipments, and UPS requires a signed tobacco agreement
- UPS does not ship cigarettes or little cigars to consumers
- For PACT Act products, register with ATF, report sales to state tax officials, and use age-verified delivery
Product Requirements:
- Follow state flavor rules. California retailers may only sell unflavored products on the Attorney General’s approved list
- Do not ship into states or cities where a product is banned
Website General Requirements:
- Terms and Conditions, Privacy Policy, Shipping, Refund, and Returns
- Clear product descriptions and prices
- Clear terms for cigar clubs and subscriptions before checkout

What People are Saying About AllayPay

If you’re looking for a transparent merchant processor that provides competitive fees and excellent customer service, AllayPay is the company for you. We joined them in Aug. 2022 after getting fed up with extreme fee structures for CBD-based businesses that had horrible customer service. AllayPay patiently went through a detailed vetting process with us during which time they answered every question…

Sarah Brandon

CEO

The AllayPay team has been fantastic! They worked with us from start to finish and customized a payment gateway for our company, Office Furniture Warehouse. It’s been over a year since we’ve been working with them now, and they are by far the most response company we’ve ever worked with. Thank you!

Bob Collins

Manager

Understanding how important customer service is, and customer reviews, I searched for a local processing service that would treat us like my business was valued… If you are in business and seeking someone who values your business, then you only need to make one phone call to this organization and you will understand what customer service should be. I am very happy I reached out to AllayPay, you will be as well.

Kary McNeal

Owner

AllayPay is by far the best merchant processing company I’ve ever dealt with. Jeff and his team spent days helping me get set up properly and answered all of my questions. They also helped me integrate my processing into QuickBooks Online by automatically updating the invoices as paid. With this new system, I’ve now saved 20 hours each month and over $15K each year. Thank you so much!

Yoav Hananya

Owner

We were using Square and knew that our options were limited for traditional processing in our industry. Not only did AllayPay save us on processing fees, but they also set us up as fast as possible considering our unique circumstances. AllayPay was highly recommended, and we are very grateful that we choose to go with them. You won’t be disappointed!

Neil Shapiro

Owner

My company was in the market for a new credit card possessor and POS system. We reached out to AllayPay on a whim, and that was the best decision we could have made! The entire team at AllayPay has given us top-priority treatment. The level of communication throughout the entire process was top-tier… We can’t recommend AllayPay highly enough!