SNAP Guide for Farmers Markets

Beginning a SNAP program at your farmers market can be a difficult and often confusing undertaking. FMC has created this guide with the intention of easing the process and helping your SNAP program be as successful as possible. The accordion panels below give a step-by-step guide to assessing your market’s needs, implementing SNAP and attracting customers.

For an overview of how SNAP/EBT processing and technology works, check out this FMC webinar recording with presenter Peter Relich from April 8, 2020.

Learn about the 2020 FNS EBT Equipment Grant Program: Marketlink, and state contracts that provide no-cost EBT machines in this FMC webinar recording from April 22, 2020.

Read an important update about SNAP EBT Equipment here.

Background Information

The Supplemental Nutrition Assistance Program (SNAP) is administered by the United States Department of Agriculture’s (USDA) Food and Nutrition Service (FNS), and serves as the nation’s largest domestic hunger safety net. FNS works with state-level agencies and partners to inform the public of nutrition assistance opportunities, sign up beneficiaries, and ensure program integrity. To receive SNAP benefits, eligible individuals must apply through their state agency.

Congress provides the parameters for SNAP through the Farm Bill—a 5 year sweeping piece of legislation that also includes rural development initiatives, crop insurance, energy programs, and the forest service. FNS takes the legislative language from the Farm Bill and turns it into nationwide SNAP program rules. State legislatures can then add additional rules on eligibility or disqualification, and build on the framework they’re given by FNS. Each state administers SNAP in the department of its own choosing. SNAP transactions use electronic benefit transfer (EBT) technology on a swipe card similar to a debit card. States often call their SNAP cards by different names. For example, in Florida, SNAP is administered by the Department of Children and Families, using their “Access” card, while in Michigan, it’s administered by the Department of Human Services, using their “Bridge” card. To find the contact person and agency for SNAP in your state, visit our State Resource Page.

For information on the history of SNAP at farmers markets over the years, visit FMC’s SNAP advocacy page. For state-by-state data on SNAP sales and SNAP-authorized markets, download FMC’s SNAP data Excel workbook.

STEP 1: Understand Your Community & Customer Base

If your market is interested in offering SNAP to your community, it’s vital to examine the readiness of your market and its operations, as well as your community, before you get started. 

Is your market ready? Running SNAP transactions at your market can be challenging to both fund and manage. Markets should consider formalizing their operating structures if they can — this could include steps such as obtaining 501(c)3 status, recruiting a board, creating by-laws, or signing up for a P.O. Box for official market mail rather than using a home address. Why formalize? It can support longevity of a market’s mission beyond the core founding staff and volunteers, as well as opening your market up to funding opportunities. Obtaining non-profit 501(c)3 status is not always the right decision for markets, but can be a crucial step if you are considering offering SNAP. Nonprofits are eligible for additional funding such as grants and solicited donations that can help support SNAP operational costs. We will dive deeper into creative ideas for funding in Step 3 of the FMC SNAP Guide.

You’ll also want to take a scan of your staff. Because SNAP often requires one-on-one customer service at markets to operate the SNAP booth, you’ll need at least one person dedicated to this work during market hours. If you are unable to staff the booth from your team, an alternative may be working with your farmers or other SNAP eligible vendors to offer SNAP at their own market stands, or recruiting reliable, trained volunteers to support market staff with SNAP transactions onsite. As SNAP EBT technology advances, you’ll want to ensure you have staff that are committed and flexible as they learn emerging technologies — whether it’s the Verifone terminal you have onsite today, or the mobile phone-based app you’re considering tomorrow!

Is your community ready? Taking the time to do preliminary research into local demographics will ensure that your farmers market is truly accessible to the neighborhood. The statewide Michigan Farmers Market Association released an updated Farmers Market Feasibility Assessment Guide in 2014; page 8 of this resource provides prospective farmers market operators with a number of tools to assist in gathering demographic information, SNAP and other statistics related to hunger, and guidance on conducting a comprehensive community assessment. Even if your market already exists, the resource is helpful for  collecting rich and useful data about your neighborhood while determining community needs. 

Data collection is increasingly important as farmers markets are tasked with demonstrating their value to communities, government agencies and funders. Start with basic data collection for your SNAP program — for example, tracking SNAP transactions or customers — and determine your capacity for more robust collection like end-of-year customer and farmer surveys. The technology you choose to manage SNAP transactions at the market can make the process of data collection easier or more difficult — that’s why it’s a good idea to think through what data is necessary to collect before you decide on SNAP point of sale technology. We’ll get deeper into your technology choices in Step 4 of the SNAP Guide. 

FMC is here to help! Learn more about data collection and evaluation at FMC’s Farmers Market Metrics web page, or sign up for your market’s free account at Market Umbrella’s marketshare portal, where you can download resources on data collection.

STEP 2: Become a SNAP Authorized Retailer

Now that you’ve taken a scan of your market and community and have decided to move forward with your plans for SNAP at your market, it’s time for your market to become an approved retailer for SNAP. 

Retailers (in your case, markets and farms accepting SNAP benefits) must be authorized by FNS (Food Nutrition Services, a branch of the USDA), who will provide a SNAP License with an FNS number. This permit number is specific to your market, and will be programmed into your market’s point of sale (POS) terminal or app. There is no charge for the SNAP License. 

Farmers and farmers markets apply for a SNAP License online here. You can also call the USDA FNS’s hotline at (312) 353-6609.

Applying is a three step application process:

  1. Get a USDA account;
  2. Fill out the application online; and
  3. Mail your supporting documentation to FNS to complete your file.
  4. You may check the status of your application using the FNS online system. 

To complete the application, you’ll need the following:

  • Photo identification and Social Security card for all owners, partners, and corporate officers, unless the market is owned by a government agency. In cases where a farmers market is owned by a non-profit cooperative, the cooperative may designate a single “responsible official,” and provide such information solely for that person.
  • USDA FNS Completed Certification and Signature Statement, which is received after submitting the application online.;
  • Any business licenses you may have for doing business at your location, under the current owner’s name (this is optional for farmers markets located on temporary sites).

If you live in a Community Property State, you’ll also have to include the Social Security Number and ID of the spouse of the person whose name is used on the SNAP application. Community Property states are currently: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Find out more about Community Property states here.

IMPORTANT: If the contact person(s) on the original SNAP application change, FNS needs to be notified and given updated information. It’s a good idea to pick a contact who anticipates being around for a long time to minimize the need to update the market’s information, and make sure you consider this as market staff turns over. 

Once your market is approved, you’ll receive your FNS permit and a packet of training materials. The permit is ongoing and doesn’t expire; however, it may be terminated if there is no activity on it for 12 months. In such cases, the market would have to re‐apply. If a market is owner-operated and ownership changes hands, a new FNS permit will be required for the new owners.

A PDF version of the application can be found here. Please note, this version is only for reference, and expired late January 2021. The information asked in this form may be slightly different from the information required on the online form. 

For more detailed information on the application, see the FNS website, and their Application Guidance.

USDA FNS also offers SNAP sign-up days, where they’re able to authorize eligible markets and direct marketing farmers onsite. Check the FNS website to find sign-up days near you. If you’d like to help schedule or organize a sign up day, contact your regional FNS representative. Their contact information can be found at this link.

Lastly, if you have an eligible cellular device and interest in no-cost SNAP equipment, MarketLink will support your market by working with you to complete your FNS authorization paperwork and connecting you with eligible technology. 

STEP 3: Find Funding, State and Federal Support

Shopper support, surcharges, vendor fees, donations, market product sales, annual appeals, sponsorships, fundraising events, and crowdfunding might all be options for covering costs associated with your market’s SNAP EBT program. Over the past few years, FNS has also implemented multiple initiatives to fund SNAP EBT equipment for direct marketing farmers and farmers markets to accept SNAP[…] Read more

STEP 4: Choose your Equipment, Provider and Method of Implementation

To accept SNAP electronic benefit transfer (EBT) access at your market, you will need to select a service provider to provide the point of sale (POS) equipment, process transactions, and deposit money in your bank account. Finding the right service provider for your market requires a little research. You will also need to decide on your form of market currency. Common options are tokens and receipt systems […] Read more

STEP 5: Manage your SNAP Accounting, Taxes, Vendor Policies and Training

With a sound bookkeeping system, you will be able to generate reports for your board, keep your vendors happy with timely and accurate reimbursements (weekly or bi-weekly) and assure that you are meeting IRS requirements. Keeping Vendors aware of the change is key to avoiding misunderstandings and miscommunication[…] Read more

STEP 6: Conduct SNAP Outreach, Promotion, and Cultivate Strategic Partnerships

Once your market has created a new SNAP EBT and/or debit/credit program, its success will depend on letting shoppers know about it… Think of as many different ways to educate potential shoppers about its availability and how it works. For SNAP, there are three main groups to target with your outreach: 1) community partners, 2) shoppers, and 3) vendors. Strategic Partnerships can help with SNAP EBT outreach in several ways […] Read more

SNAP Glossary

App: Shorthand for “mobile application” which is designed and downloaded for smartphones, tablets, or other internet-ready mobile devices. 

Early termination fee: A fee charged by merchant service providers when a contract is ended prematurely. Early termination fees vary by provider. 

EBT: Electronic Benefit Transfer. The electronic system that allows SNAP benefit recipients to swipe a card to use their federal benefits, rather than paper vouchers. 

FMC: Farmers Market Coalition.

FNS: Food and Nutrition Service.The agency within the United States Department of Agriculture that administers the Supplemental Nutrition Assistance Program (SNAP), WIC Farmers Market Nutrition Program (FMNP), Senior Farmers Market Nutrition Program, and WIC Fresh Fruit & Vegetable Cash Value Voucher (CVV) Program, among others.

Incentive Program: An incentive program offers SNAP (or any other nutrition benefit) recipients a financial incentive for redeeming their benefits on fruits and vegetables at the farmers market.

Interchange Fees: A type of transaction fee that is paid by retailers to card issuers (the banks that sponsor the credit or debit cards). The rates are set by the card associations (e.g. MasterCard or Visa) and are based on a combination of factors including amount of the transaction, total volume, and type of business. Issuers who collect the fees then pay the fees to the card associations.

For every debit/credit card that exists, there is an associated pre-set rate that the merchant service provider pays to the issuing bank. The interchange rate has two components: a percentage fee of the volume of the sale, and a per-transaction fee. Typically, the interchange rate will be written in this format:  2.00% + $0.10.

The Agricultural Act of 2014, prohibits interchange fees from applying to SNAP EBT transactions, however debit and credit transactions remain subject to interchange fees.

IRS: Internal Revenue Service. The revenue service of the United States federal government. The government agency is a bureau of the Department of the Treasury.

Manual Vouchers: When retailers, farmers, or farmers’ markets offer SNAP EBT, sometimes the point of sale operator has challenges accessing SNAP benefit balance and finalizing transactions — this could be due to a user error, or a system outage from the state’s contracted processing company. In the event of an outage, retailers or markets can process a transaction “offline” by recording key information about the shopper and the transaction — including the market’s FNS number,  the shopper’s SNAP card number, the cost of the purchase being made, the date, and other key details. Then, markets are responsible for “reconciling” transactions directly with the payment processor. 

PCI Compliance: The Payment Card Industry Data Security Standard (PCI DSS, commonly referred to as simply PCI) compliance is designed to protect businesses and their customers against payment card theft and fraud. If your retailer accepts, stores, or transmits card data, PCI DSS compliance certification is required by card brands such as Visa, MasterCard and Discover.

Many service providers charge a PCI compliance fee and provide compliance support. For example, a PCI fee may be something in the area of $70-$120 a year, or about $6-$10 a month for compliance support involving scans and assistance completing compliance questionnaires once per year. The PCI fee may be greater or less depending on the level of support provided. If the PCI compliance survey isn’t completed by the retailer annually, the service provider will often charge a non-compliance fee.

POS: A Point of Sale device is the equipment used to process an EBT, credit or debit transaction. Retail outlets typically use a wired POS, while most farmers markets require a wireless version. 

Scrip: In cases where individual farmers do not have a SNAP license to accept SNAP benefits, a farmers market can obtain a SNAP license and allow eligible farmers in the market to accept SNAP benefits, by issuing scrip and using a centralized point of sale device to process transactions. There are two basic scrip systems:  

  • Paper scrip or tokens: Market staff swipe the EBT card at a centrally located POS device, debiting the amount requested by the customer in exchange for paper scrip or tokens, which can then be used to shop at all eligible food booths in the market. Farmers trade the scrip/tokens with market staff for payment.
  • Receipts: A customer sets aside selected food at a farmer’s booth, and the farmer gives the customer a list of the selected items. The customer then takes the list to the centralized POS device, uses an EBT card to pay for the items, and receives a receipt. The customer then gives the farmer the receipt in exchange for the selected food. Market staff keeps track of the receipts and reimburses farmers based on the day’s purchases.
  • (Coming soon) Loyalty Card Systems and Mobile Wallets: Much like the existing token system, SNAP shoppers redeem EBT benefits in exchange for a balance loaded onto either a loyalty card or mobile wallet, which can then be used at eligible vendor booths. These systems are being piloted at select markets, and we can expect more versions of these systems to emerge in the coming years.  

Seasonal fee: A fee that a merchant service provider may charge if services are only used for a portion of the year. Paying the seasonal fee allows a market to avoid paying monthly services fees during months when the market is not operating. This seasonal fee can be cheaper than paying for an early termination fee. 

SNAP: Supplemental Nutrition Assistance Program. A federal program that provides nutrition benefits to low-income individuals and families that are used at stores to purchase food. The program is administered by the USDA Food and Nutrition Service (FNS) through its nationwide network of FNS field offices. 

Third Party Processor, Merchant Service Provider, or Service Provider: The company that offers payment processing services (for example MarketLink works with the third party processor, Novo Dia Group). Sometimes abbreviated to TPP. 

Tokens: Tokens are used as currency in farmers markets that offer SNAP EBT, credit or debit transactions through a centralized point of sale (POS) device. Market staff swipe the EBT, credit or debit card at the POS device, debiting the amount requested by the customer in exchange for tokens, which can then be used to shop at all eligible food booths in the market. Farmers trade the tokens with market staff for payment. Tokens serve as a scrip system.

Transaction Fees: Fees charged for every transaction through electronic transfers (debit, credit, EBT). These fees are paid to, and determined by, the merchant service provider. Debit, credit and EBT transactions are subject to transaction fees. Interchange fees are a type of transaction fee that is paid by the merchant service provider to the issuing bank, and are set by the industry (Visa/Mastercard/ Discover). EBT transactions are excluded from Interchange fees. See Interchange fees for more info. 

USDA: United States Department of Agriculture.

Other Resources

Coming in 2021, FMC and the Nutrition Incentive Hub are bringing you a dedicated resource library for farm direct sites looking to grow or begin nutrition incentive programs. Many of the resources on this list are nearing 10 years old but yet are still relevant, aside from some key technology changes. Please stay tuned for further updates on SNAP resource aggregation.

More and more resources are being developed to help aid farmers markets looking to expand access through federal nutrition programs like SNAP and GusNIP incentives. While the guide on this site presents the most pertinent details, it is not meant to be exhaustive.  An essential first step is to read more about the process of becoming a SNAP-authorized retailer. FMC recommends reading SNAP at Farmers Markets: A How-To Handbook, a publication co-authored by USDA and the Project for Public Spaces, as well as a complementary guide, SNAP/EBT at Your Farmers Market: Seven Steps to Success.

Below are some additional sources of guidance and best practices.