Should You Offer SNAP EBT at Your Market?

Electronic Benefit Transfer (EBT)
is an electronic system that allows customers to use government-issued benefit debit cards to pay for food. All states now use EBT to issue Supplemental Nutrition Assistance Program (SNAP) benefits (formerly known as food stamps), and paper benefit vouchers are increasingly falling out of use. Although there is no requirement that farmers markets use EBT systems, doing so provides a great benefit to customers who otherwise don’t have access to fresh, healthy, local produce, and it may also increase sales at your market!

Big Picture Questions As Your Market Gets Started

  • Market Mission: Is serving low‐income shoppers, addressing local hunger issues, or building community food security part of your market’s mission?
  • Leadership: Getting set up to accept EBT can take considerable time and effort. Given all the demands of a market, this can be challenging. Does your market have someone who will spearhead this effort and follow through on all the steps involved? It can be the market manager, a board member, a partner organization, or even a very strong, committed volunteer. This person leading the effort must be committed to the full implementation.
  • Administrative Capacity: Does your market have the ability to keep precise and timely records, manage accounts, and reimburse vendors? This is an especially important requirement when accepting EBT since SNAP benefits are a federal program. USDA is very concerned about fraud and misuse of public dollars and they expect accurate recordkeeping and management. In addition, good recordkeeping will help you respond to the IRS 6050W Electronic Payment Reporting Requirements.
  • Ongoing Duties: During the market season, an EBT and/or debit/credit program requires additional bookkeeping and someone responsible at your information booth at all times. Does your market have staff or volunteers who can take on these new duties?
  • Financial Resources: There are start-up costs, ongoing costs, and new liabilities associated with accepting EBT and/or debit/credit. Can your market absorb these costs or participate in a grant program to offset expenses? If you are uncertain of these costs check out Estimated Costs, below.
  • Community Demand:  What is the market’s current or potential shopper base? Are people stopping at the market info booth asking about EBT? Does your neighborhood include people who receive SNAP or food stamps? If you’re not sure, ask your local food bank, anti‐poverty program, or DSHS office. Are shoppers asking vendors if they accept EBT cards? Managers will need to ask vendors about this, as they might not think to volunteer such information. Do you currently have WIC or Senior Farmers Market Nutrition Program (FMNP) at your market? Often these customers also have EBT benefits that could be used.

Farmers EBT Program Option: If you’re concerned your market doesn’t have the capacity to operate an EBT program on its own, you might consider a farmer-operated system, where each farmer owns and operates their own individual EBT machine. In 2005, Iowa’s Department of Human Services used SNAP administrative funds to purchase equipment for farmers selling at markets, and the program continues successfully today. A farmer-driven program removes the need for tokens, and significantly reduces administrative burdens on the market management. However, this system relies on vendors to become authorized and trained to provide SNAP access, which can complicate promotion, outreach, and consistency of the program. Click here to learn more about Iowa’s farmer EBT program.

What about Credit and Debit Cards?
In order accept SNAP EBT at your market, you’ll need a point of sale device (POS). You can choose to only accept EBT with your POS, or you can choose a POS that allows you to also accept credit and/or debit cards. Should you include debit and credit? The vast majority of markets that accept SNAP EBT, debit, and credit cards find that most transactions – over 80% ‐‐ are for debit and/or credit cards. Offering multiple payment options at your market can help increase vendor sales and expand your customer base, but offering SNAP EBT, debit, and credit services increases the number of transactions and requires more bookkeeping oversight. The following chart from the Washington State Farmers Market Association outlines some of the opportunities and challenges:

From Washington State Farmers Market Management Toolkit, Chapter 7 (July 2013)

From Washington State Farmers Market Management Toolkit, Chapter 7 (July 2013)

In some cases, higher percentage fees are levied on credit cards, and fees may be different whether a debit card user enters their PIN uses only the swipe option. Do the math on a hypothetical transaction of $50 based on the type of card used after receiving a processor’s quote. Many markets choose to accept only debit cards, and some (like the Durham Farmers Market and Ithica Farmers Market, for example) even opt to bring a temporary ATM onsite during market days rather than offer debit services themselves.

Estimated Costs
The cost of your SNAP program will depend on: 1) which EBT equipment and service you choose, 2) the number of transactions at the market, 3) the fixed monthly card service fees, and 3) which funding opportunities your market is eligible to receive. In addition, markets need to secure paid personnel or volunteers to provide cards services at the information booth, manage the bookkeeping of sales and reimbursements, and promote the SNAP EBT offering. Here are estimated time and dollars resources need to start up and maintain a successful program, based on analysis from the Washington State Farmers Market Association:

For EBT Only:

  • Obtain a SNAP Permit: Free
  • Purchase or Rent EBT Equipment: $400-$1,200 one time cost, (free in many states)
  • Transaction costs: $.10 – $.15 per SNAP transaction,
  • Fixed monthly Service Plans: $20 – $40
  • Purchase Tokens: ~ $150
  • Point of Purchase Customer Service (at market): 4-5 hours
  • Reporting & Tracking: 2 hours per week of staff time
  • Signage & Advertising: ~$750/year
  • Outreach: 1-3 hours per week of staff time

For EBT, Debit, and Credit

  • Obtain a SNAP Permit: Free
  • Purchase or rent EBT Equipment: $400-$1,200 one time cost, (free for eligible markets)
  • Transaction costs: $.10 – $.15 per SNAP transaction, debit and credit cards fees are 1 % to 2+% of token sale plus a $.10 to $.20 fee.  Prices vary, ask the card service provider for details.
  • Fixed monthly Service Plans: $20 – $40
  • Purchase Tokens: ~ $300
  • Point of Purchase Customer Service (at market): 4-5 hours
  • Other supplies (paper, batteries, etc): $200 annually
  • Reporting & Tracking: 2-5 hours per week of staff time
  • Signage & Advertising: ~$750/year
  • Outreach: 1-3 hours per week of staff time

Note: Costs will likely be toward the higher end for markets that choose to add Credit in addition to Debit.

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