Nationwide Payment Systems

Vape Enforcement Is Increasing: What Convenience Stores, Smoke Shops and Gas Stations Need to Know in 2026

FDA and payment-network enforcement against unauthorized vape and ENDS products is increasing. Learn what retailers should check to protect their merchant account.

Presented by Allen Kopelman, CEO — Nationwide Payment Systems-Host of B2B Vault: The Biz2Biz Podcast

AI OVERVIEW

Vape Enforcement Is Increasing, making the sale of vape products more than an inventory-compliance issue.

It can now become a payment-processing issue.

On July 3, 2026, Reuters reported that Fiserv and major fuel operators including BP, Marathon Petroleum and Valero had warned U.S. retailers about selling unauthorized vaping products. Reuters reported warnings that violations could potentially lead to significant financial penalties or loss of payment-processing privileges. (Reuters)

This matters because losing a merchant account can affect the entire store — not simply the vape portion of the business.

A convenience store processing hundreds of thousands of dollars in fuel, food, beverages and merchandise could potentially put that processing relationship at risk because of a relatively small amount of noncompliant vape inventory.

The message for retailers is straightforward:

Know exactly what you're selling. Verify vape products against FDA resources. Keep documentation. And don't assume that because a distributor sold you a product, the product is FDA authorized.

FDA Authorized E-Cigarette List

https://www.fda.gov/authorizedecigs

This page provides the FDA's list of specifically authorized e-cigarette products.

FDA Searchable Tobacco Products Database

https://www.fda.gov/searchtobacco

The FDA created this searchable database specifically to help the public and retailers identify tobacco products that may be legally marketed in the United States. FDA says the database is updated regularly. (U.S. Food and Drug Administration)

Don't rely on an old, printed list. Check the FDA database directly.

FDA Authorization Is Product-Specific

One of the most important concepts for retailers to understand is that FDA authorization is attached to a specific product.

It does not automatically extend to every product made by the same manufacturer.

For example, a manufacturer could potentially have an authorized device or cartridge while selling other products that have not received FDA marketing authorization.

That means retailers should not simply ask:

"Is this an FDA-approved brand?"

The better question is:

"Is this exact product authorized by the FDA?"

Check the specific:

Manufacturer

Brand

Device

Cartridge or pod

Flavor

Product variation

SKU or UPC when available

The FDA's searchable database should be the starting point. (U.S. Food and Drug Administration)

Does a Pending FDA Application Make a Vape Legal to Sell?

Do not assume that it does.

A manufacturer or distributor might tell a retailer:

"Our PMTA is pending."

"We filed with the FDA."

"The FDA hasn't denied the product."

"We've been selling it for years."

Those statements should not be treated as FDA marketing authorization.

FDA explains that e-cigarettes appearing in its authorized database are the products that have received marketing granted orders. (U.S. Food and Drug Administration)

If you aren't sure about a product, verify it directly with FDA rather than relying exclusively on representations from the manufacturer, salesperson or distributor.

What Vape Products Are Receiving Enforcement Attention?

FDA enforcement has specifically targeted unauthorized flavored and disposable e-cigarettes.

For example, the FDA has previously issued enforcement actions involving products marketed under names including Geek Bar, Lost Mary and Elf Bar. (U.S. Food and Drug Administration)

That does not mean retailers should build compliance decisions from a list of brand names they found online.

Remember:

Authorization is product-specific.

The best practice is to check the exact product against current FDA resources.

Products frequently change. Product lines change. FDA actions change.

Use the database.

Why Are Payment Processors Getting Involved With Vape Sales?

This is where the situation has changed dramatically for merchants.

On July 3, 2026, Reuters reported that Fiserv, BP, Marathon Petroleum and Valero had warned U.S. stores about sales of unauthorized vaping products.

Reuters reported that notices warned merchants about possible substantial financial penalties or loss of card-processing privileges. (Reuters)

Reuters also reported that BP told operators Mastercard had begun issuing compliance violation notices regarding transactions involving illegal ENDS products. (Reuters)

That means vape compliance is no longer only an issue between the store and the FDA.

It can involve:

FDA → Retailer

Card Network → Acquiring Bank

Acquiring Bank → Processor

Processor → Merchant

Fuel Brand → Dealer

Marketplace or Ecommerce Platform → Merchant

The payment ecosystem is increasingly becoming part of regulated-product enforcement.

Concerned About Your Merchant Account?

If you operate a convenience store, gas station, smoke shop or other regulated retail business and have questions about your payment-processing relationship, Nationwide Payment Systems can help you review your processing setup.

We cannot determine whether a particular product is legal to sell, but we can help businesses understand payment-processing requirements, acquiring-bank concerns and card-network risk.

Book a Strategy Call with Nationwide Payment Systems.

How Can Payment Companies Discover What Products a Merchant Sells?

One of the biggest misconceptions we encounter is:

"The processor only sees the dollar amount. They don't know what I sold."

That is not a safe compliance strategy.

Compliance investigations can potentially involve several sources of information, including:

Mystery shopping

Merchant websites

Google Business Profiles

Ecommerce stores

Social-media advertising

Customer complaints

Regulatory investigations

Merchant underwriting

Transaction monitoring

Requests for invoices

Requests for inventory information

A merchant doesn't necessarily need to process an individual vape SKU through an ecommerce checkout for a processor to discover what the business sells.

Your digital footprint matters.

Could Unauthorized Vape Sales Affect the Entire Merchant Account?

Potentially, yes.

This is particularly important for gas stations and convenience stores.

Imagine a convenience store processes:

$250,000 per month total

but only:

$5,000 per month in vape products.

The merchant may think:

"Vapes are only 2% of my sales."

But a compliance issue involving that 2% could potentially affect the merchant account processing the other 98%.

That is why regulated products need to be treated differently from ordinary store inventory.

Chips, soda and bottled water generally don't create card-network compliance investigations.

Vape, tobacco, CBD, hemp and other regulated products can.

Can Unauthorized Vape Sales Lead to Losing Credit Card Processing?

They potentially can.

Reuters reported warnings to retailers that unauthorized vape activity could result in significant penalties or loss of payment-processing services. (Reuters)

Depending upon the circumstances and the merchant's agreements, possible consequences can include:

Merchant Account Investigation

The processor or acquiring bank may request:

Product lists

Distributor invoices

Supplier information

Photographs

Website information

Compliance documentation

Processing Restrictions

The processor or acquiring bank may require the merchant to discontinue certain products.

Merchant Account Termination

A processing relationship can potentially be terminated when prohibited or unlawful activity is identified.

Card-Network Assessments

Network violations can potentially result in significant financial assessments. Reuters reported retailer warnings describing penalties potentially reaching the mid-six figures for a violation. (Reuters)

MATCH Reporting

Certain merchant-account terminations can potentially result in a merchant being reported to Mastercard's MATCH system when applicable MATCH criteria are satisfied.

Getting another merchant account after MATCH placement can become significantly more difficult.

Why Going Cash-Only Doesn't Solve the Problem

Some retailers may think:

"I'll just take cash for those products."

That is not a compliance solution.

Whether a product may lawfully be marketed doesn't change because the consumer pays with:

Cash

Credit card

Debit card

Cryptocurrency

Another payment method

Nationwide Payment Systems does not recommend attempting to structure transactions around card-network monitoring.

If there is a question about whether a product may legally be sold, the retailer should determine the regulatory status of the product, not find a different way to accept payment for it.

What Should Vape Retailers Do Right Now?

Every convenience store, smoke shop, vape shop and gas station selling ENDS products should conduct an inventory review.

Step 1: Create a Complete Vape Inventory

Document:

Manufacturer

Brand

Exact product

Flavor

Nicotine strength

Distributor

Purchase date

Step 2: Search the FDA Database

Go directly to:

https://www.fda.gov/searchtobacco

Do not rely exclusively on the distributor.

Step 3: Check FDA's Authorized E-Cigarette List

Visit:

https://www.fda.gov/authorizedecigs

As of August 2026, FDA lists 45 authorized e-cigarette products. (U.S. Food and Drug Administration)

Step 4: Keep Distributor Documentation

Maintain records including:

Purchase invoices

Product descriptions

Distributor information

Manufacturer documentation

FDA authorization information

Step 5: Review Your Website

Search your own website for vape brands and products.

Step 6: Review Google and Social Media

Review:

Google Business Profile

Facebook

Instagram

TikTok

Online menus

Delivery platforms

Ecommerce pages

Step 7: Establish an Inventory Approval Process

Employees should not add a new vape line because a sales representative offers a discount.

Someone responsible for compliance should approve new regulated products before they reach the shelf.

Step 8: Recheck Products Regularly

Regulations and enforcement activity change.

Compliance should be an ongoing process.

What Should You Do If Your Processor Sends a Compliance Notice?

Do not ignore it.

A merchant should immediately determine:

What product or activity triggered the inquiry?
Is the product listed in FDA resources?
What invoices and supplier documentation are available?
What deadline did the processor provide?
Has the processor requested removal of the product?
Does the merchant need qualified regulatory or legal counsel?

Preserve all correspondence and supporting documentation.

If there is uncertainty about a product, temporarily stopping the sale while obtaining appropriate professional guidance may be considerably less expensive than risking the entire merchant account.

Shopify's 2026 Vape Policy Shows How Broad This Is Becoming

Payment processors aren't the only companies tightening policies.

Reuters reported in June 2026 that Shopify planned to prohibit vape sales through its platform, and on July 10 reported that Shopify was telling merchants to remove vape products from online stores. (Reuters)

That demonstrates a larger trend:

Private companies that provide the infrastructure businesses need to sell regulated products are becoming an increasingly important part of compliance enforcement.

That includes:

Ecommerce platforms

Payment gateways

Payment processors

Acquiring banks

Card networks

Fuel brands

Marketplaces

Retailers need to understand not only government requirements but the requirements of every major provider their business depends upon.

This Goes Beyond Vape Products

The larger lesson here applies to many regulated industries.

A merchant may need to satisfy three separate questions:

Is the product or service legally permissible?

That is a regulatory/legal question.

Do Visa, Mastercard and other payment networks permit it?

That is a card-network question.

Will the merchant's acquiring bank accept the business?

That is an underwriting and risk question.

Those answers aren't always identical.

This is becoming particularly important for businesses involving:

Vape and tobacco

CBD and hemp

Pharmacies

Telemedicine

Nutraceuticals

Age-restricted products

Firearms

Subscription businesses

Other highly regulated industries

At Nationwide Payment Systems, we regularly work with businesses whose payment-processing needs don't fit neatly inside the standard Stripe, Square or PayPal model.

Protect the Business Before There's a Processing Problem

It is much easier to address a potential compliance problem before an acquiring bank terminates a merchant account.

Nationwide Payment Systems has worked with merchants since 2001 and specializes in customized payment solutions for businesses ranging from traditional retail to complicated and regulated industries.

We help merchants understand: