Despite moves by major retailers, like Walmart and Dick’s Sporting Goods, to tighten restrictions on gun sales, many smaller, independent firearm shops have not followed their leads.
Deciding that these market leaders were using the platform as a publicity stunt following the mass shooting at a Parkland high school that left 17 dead, small gun shop owners opted to keep doing what they were doing as long as the followed all local, state, and federal firearm laws.
Though private-owned shops operate legally, they often have very difficult times get approved for gun merchant accounts. Banks do not want to take the risk associated with this controversial industry that also includes a lot of legal ambiguities. If you want to accept debit and credit card transactions, you need a merchant account. The best way to get an account will be to apply for one through an alternative lender, know the laws, and find out what you need to increase your chances of getting approved.
Know the Law and Know They Are Confusing
To legally operate an online gun store or have a business presence on an online auction site, you must be a federally licensed firearms dealer or have access to one. To obtain a Federal Firearms License (FFL), you must apply for one through the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). All interstate firearms transfers are done between FFL holders. To start conducting business, you must have your FFL.
Though it is legal to purchase guns online, federal laws prohibit merchants from shipping serial numbered parts, handguns, or long guns directly to out of state consumers. The law requires firearms to first be transferred to a federal firearms licensed dealer or (FFL) in their same state of residence. Dealers that accept the transfer on the purchaser’s behalf will require the buyer to fill out a 4473 Form and conduct a federally-required background check. Private, unlicensed sellers are not impacted by this law.
The legalities surrounding possession and ownership also are not black and white, since individual states also can adopt their own laws. For instance, Colorado and New York require background checks through the National Instant Criminal Background Check System (NICS) if a gun is bought through a private sale. However, in places, like Louisiana and Arkansas, there are few restrictions on private gun sales, including those made online.
When It’s Time to Apply for a Gun Merchant Account
In addition to following the laws where you plan to sell, a merchant service provider will want to know that your website has clear terms and conditions and a privacy policy. These are necessary to protecting your business from excessive chargebacks and fraud.
When operating any online business, especially one that sells guns, security is vital. Therefore, implementing standard security technology, like a secure socket layer (SSL), is also a good step to take. An SSL establishes an encrypted link between your customer’s browser and a web server, ensuring that any information that passes between the two are private.
Some History on the Changes Retailers Made to Their Gun Policies
In the wake of numerous mass shootings, including, more specifically, the shooting at Marjory Stoneman Douglas High School in Parkland, Florida, many retail giants called for changes.
Dick’s Sporting Goods was the first to make an impassioned plea for “common sense gun reform,” and then, announced it was raising the minimum age to purchase a gun to 21 and that it would stop selling AR-15-style weapons and high-capacity magazine. Walmart followed suit, announcing it also was raising the gun sale age to 21. Walmart stopped selling AR-15 rifles in 2015. Kroger also agreed to do the same at its Fred Meyer locations, but eventually decided it would all together start phasing out the sale of firearms and ammunition.
Dick’s reported in November that sales were down 3.9 percent in the third quarter, due in part to double-digit declines in the areas of electronics and hunting. This period falls in line with their gun policy changes.
