EBT Payment Processing
Most businesses know that accepting EBT payments will help grow their profits. However, there’s much to consider before accepting EBT cards, such as filing an application, meeting hardware requirements and understanding the costs involved. Read on to learn more about EBT payment processing and how our EBT specialists can help.
Three Easy Steps on How to Accept EBT Today
You need a USDA FNS (Food and Nutrition Service) permit to process EBT transactions, so check to see if you have one. If not, call us directly at 1-888-902-6202 to start accepting EBT transactions today.
We have a dedicated staff of EBT/SNAP experts who work closely with small business owners to ensure you have the proper equipment. Most importantly, they make sure you aren’t paying too much for your EBT processing services. Call 1-888-902-6202 now to speak with a Small Business EBT Specialist who can show you how to accept EBT payments today.
Once approved, we will ship you your new processing equipment. You will receive your new updated all-in-one machine that processes EBT/food stamps, EMV, and credit/debit card transactions in as little as 24 hours. Get approved today, process transactions tomorrow.
Ready to Accept EBT at your business?
Getting a license and equipment on how to accept EBT today can be confusing. Let us walk you through the process with an easy-to-use checklist on how to accept EBT today. You can also give us a call at 888-902-6202 and we’ll help over the phone!
How to Become an EBT Retailer
All grocery stores, farmers’ markets and convenience stores must apply for a SNAP permit with the USDA FNS to accept EBT card payments. To receive a permit, you’ll need to sell staple foods in four main categories or have more than 50% of your gross retail sales come from selling one or more staple foods.
For more information about EBT card processing and how to become an EBT retailer, check out our guide.
Hardware Requirements for Accepting EBT Payments
Once you get your SNAP permit, you need to ensure you have the right hardware to accept EBT card payments. An EBT terminal machine is the kind of point of sale system you need to handle EBT exchanges. Although people swipe their EBT card much like a debit card, you need to keep EBT card processing separate from other transactions at your store.
While your existing hardware may accept EBT card payments, you should make sure it meets specific requirements. Your hardware needs:
- The ability to accept PIN debit transactions through a separate, stand-alone unit or PIN pad integrated into your terminal
- The ability to be programmed with your provider’s encryption keys
- The ability to use a 7-digit FNS account number to set up your merchant account for EBT payments
If you decide to keep your existing equipment, you’ll need to reprogram your terminals to start accepting EBT payments. You can also purchase a brand new EBT terminal machine if you want to get to work quickly. The proper machine will ensure you maintain distinct accounts for easy reporting to your state’s EBT vendor. After processing all EBT card payments, you can transfer the money to your bank account, just like a regular debit or credit card exchange.
Some places are eligible for free processing equipment through the FNS, such as military commissaries, group living arrangements, treatment centers, eligible farmers’ markets and more. Contact the FNS if you think you’re eligible for free EBT merchant services.
The Cost of Processing EBT Payments
If you decide to simply add EBT card processing capabilities with your existing point of sale equipment, you may experience extra fees. You’ll have to pay for every transaction, with prices changing depending on your transaction levels. You may also be subject to hidden fees, which undercut your profits.
On the other hand, new EBT terminal machines can lead to lower costs. EBT transactions have no interchange fees or PIN debit fees. However, your merchant account provider will usually charge you for processing the transactions. It’s important to ask a provider how they treat EBT transactions and what costs are involved before signing a contract.
Quick Guide to Accepting EBT
How to accept EBT today?
To accept SNAP food stamps in your store, you must get a SNAP permit. To get a permit, you must file an application with the USDA Food and Nutrition Service (FNS). The FNS is the government agency in charge of SNAP food stamps. The SNAP permit is free. You must have a permit for each store you own, and the permit must be in your name. You cannot take over someone else’s SNAP permit. You must sell certain types of food in your store to get a permit:
- You can get a permit if you sell a variety of staple foods in each of four food categories: (1) dairy products (2) breads, grains, and cereals (3) fruits and vegetables and (4) meat, fish, and poultry. Foods can be fresh, frozen, or canned. However, you must stock perishable foods in at least two of the food categories.
- You can also get a permit if more than 50% of your gross retail sales comes from the sale of one or more staple foods.
How do I apply for a permit?
To apply for a SNAP permit, you must file an application with the Food and Nutrition Service. How to get an application: To get an application from the Food and Nutrition Service (FNS):
- Use the FNS online form: Online Store Application
- If you need assistance or have questions call us at 888-902-6202
Documents you must include:
You must include copies of several documents with your application. The FNS office may also call you for more information, or send someone to visit your store. You should include:
- A copy of a current license for your business (for example, a sales tax permit or health permit)
- A copy of your driver’s license (front and back), passport, or other photo identification
- A copy of the Social Security cards for all business owners, partners, officers, and shareholders, and their spouses
How to file the application:
- If you use the online application, you can submit the application and check the status of your application online. After you submit the online application, you must send copies of your documents to the FNS address on the form.
- If you use a paper application, sign the application and send it with copies of your documents to the address on the form.
There is no charge for a food stamp permit. If you have any questions, call the FNS toll-free number 1-877-823-4369. The FNS office has 45 days to either approve or deny your application. If your application is not complete, it may take longer. If your application is denied because your store does not meet the eligibility requirements, you must wait six months before you can apply again. You are not allowed to accept SNAP food stamps at your store until you have been approved. To apply for a SNAP permit, you must file an application with the Food and Nutrition Service.
Can farm stands, farmers' markets, and CSAs accept SNAP food stamps?
Farm stands, farmers’ markets, and CSAs (Consumer Supported Agriculture) can become authorized SNAP vendors:
- Farm stands apply as individual retailers.
- Farmers’ markets usually apply for a single central SNAP retailer license that can be used by all individual vendors at the market. (Individual vendors can also apply on their own.) Farmers’ markets with a central license can use tokens, paper scrip, or a receipt system to allow SNAP customers to buy food from individual vendors in exchange for a single SNAP/EBT payment.
- CSAs apply as individual retailers, but cannot charge SNAP customers up front for CSA shares in the same way as they charge non-SNAP customers.
- For-profit CSAs must give SNAP customers their farm share products when they pay
- Non-profit CSAs can collect EBT/SNAP payments up to 14 days before SNAP customers get their farm share products
- Farm stands, farmers’ markets, and CSAs that have electricity and a phone line can use an EBT-only machine supplied by the FNS, or a standard debit and credit card machine connected to the EBT system. Manual vouchers are another option. See How do I use EBT? (below) for details.
For more information, see Becoming an Authorized SNAP Retailer – Guide for Farm Stands and CSAs fromCISA; and Learn How You Can Accept SNAP Benefits at Farmers’ Markets from the USDA.
How do I use EBT?
All SNAP food stamps now come on EBT cards. EBT cards work like other debit cards. When SNAP food stamps customers pay for their food, the amount of the sale is automatically subtracted from their EBT account and credited to your store’s bank account. The money is deposited in your account within two business days. To accept SNAP EBT payments electronically, you must have equipment that can process EBT transactions. If you already have equipment to handle credit and debit card purchases, you can use the same equipment to handle EBT cards. Your FNS office will help you connect your equipment to the state EBT system.
What foods can customers buy with SNAP food stamps?
- Customers can use SNAP food stamps to buy any food item except food that is hot when sold, or food that is sold to be eaten in the store like restaurant food. Eligible food items will be determined by your state.
- Customers can use SNAP food stamps to buy seeds or plants that they will grow to produce food for their household.
- Customers cannot use SNAP food stamps to buy non-food items like alcoholic beverages, cigarettes, vitamins or medicines, pet foods, soap, cosmetics, laundry products, paper goods, or other household products.
For more details about eligible food items, including additional information about “junk” food, luxury items, energy drinks, and holiday food items, see Eligible Food Items on the USDA web site.
What rules do I have to follow?
Your FNS office will explain the rules you must follow for the SNAP Food Stamp Program. They will also explain the penalties for not following the rules. Some of the most important rules are:
- You can only accept SNAP food stamps for eligible food items.
- You cannot charge sales tax on any items bought with SNAP food stamps.
- You cannot accept SNAP food stamps as payment on credit accounts. Your food stamp customers must pay for their purchases at the time of sale. You cannot give them credit and let them pay you back with SNAP food stamps at a later date.
- You cannot give cash in exchange for SNAP food stamps.
- You cannot give cash change for SNAP purchases. The amount charged to the customer’s EBT account must be the exact amount of the food purchase.
- You cannot give cash refunds for food bought with SNAP food stamps. Refunds must go to the customer’s EBT account.
- You cannot process a SNAP purchase unless the customer has the EBT card and PIN.
- You must treat SNAP food stamp customers and other customers the same. For example, you cannot have a special line for SNAP food stamp customers, or charge them higher prices, or require a minimum purchase. If you accept coupons from other customers, you must accept coupons from SNAP customers.
You must follow all of the SNAP Food Stamp Program rules and regulations. If you do not follow the rules, you can lose your permit. You may also have to pay a fine. You or your customers can report SNAP food stamp fraud or abuse if someone isn’t following the rules. The SNAP Fraud Hotline is 1-800-424-9121.