A Complete Guide to Accepting EBT For Small Businesses

Electronic Benefit Transfer or EBT payments can be a lifeline for many people. Those who have low incomes or are disadvantaged can utilize EBT payments to cover the cost of various food products. Various businesses are ready to help those people by providing support for EBT payments. 

You can start accepting EBT if you run a small business that sells products that qualify for EBT sales. Here’s a look at how you can get this to work.

Understanding EBT

The Electronic Benefit Transfer system allows customers to utilize the benefits they will receive under the Supplemental Nutrition Assistance Program or SNAP. SNAP is a federal program that helps eligible people acquire healthy foods they might not otherwise afford.

The SNAP program replaced the national food stamp program in 2008. The EBT cards associated with SNAP will connect to each eligible participant’s account to help pay for these foods.

The EBT system ensures people can afford the foods they need for their health. It is often hard for people to purchase these products, as they are often more expensive than other foods that might not be as healthy. With the EBT system, people will have a fair chance at getting the nutritious foods they deserve.

Why Accept EBT Transactions?

There are many reasons why you should consider accepting EBT transactions:

  • EBT payments work similarly to credit or debit card payments. You won’t require extra hardware or software in most situations. You may also qualify for free hardware if necessary.
  • You won’t be charged lots of money when accepting EBT payments. Since this is a government program, the rates you will be charged will be minimal. It can cost less than a dime to process some transactions.
  • You will help those who might struggle to earn a living. Many people who use EBT payments have low incomes, are unemployed, or are undergoing significant financial hardships.

Are You Eligible?

The first thing to do before you can start accepting EBT payments is to review whether you are eligible to accept them. You must see if the products you sell at your small business qualify. You can meet one of these two standards:

  • You must sell perishable foods in at least two specific food categories. These categories are for fish and poultry, meat, dairy, cereals, bread and grains, and fruits and vegetables.
  • At least fifty percent of your revenue can come from the sale of foods in one of the categories listed above.

Coffee, tea, and prepared foods are not included in either of these points for payments.

Apply For a SNAP Permit

You can apply for a SNAP permit if you meet one of those two earlier requirements. You can contact your local Food and Nutrition Service Field Office to apply for a permit. You must provide the following in your application with the FNS:

  • A copy of your business license; you can include a sales tax license or health department permit
  • A copy of your driver’s license or another piece of identification
  • Copies of the Social Security cards for all your employees
  • Your banking data, including details on the bank you utilize
  • Your merchant account data, including points on the account provider’s location

It can take up to forty-five days for you to get approved. You’ll receive a unique seven-digit FNS account number when you are approved.

Ask For Equipment Help

You can then ask the manufacturer of your POS equipment to program your setup to accept EBT payments. You may not require any additional pieces of hardware or software to make this work. But not all existing systems will support EBT transactions. You’ll need to acquire a new setup in some cases.

The government can provide you with free equipment to help you process EBT payments. New EBT-only devices can work alongside your existing infrastructure. You can use this equipment for free if you tally at least $100 in EBT payments each month.

You could also qualify for free equipment if you operate a qualifying business. Some of these entities include farmers’ markets, direct-marketing farms, nonprofit organizations, treatment centers, or military commissaries. You must provide details on your business and its operations when aiming to acquire free equipment.

Watch For the Rules

You’ll be subject to many rules when accepting EBT payments. In addition to rules on what you can process, there are other terms surrounding the following points:

  • All payments are for SNAP-approved products and nothing else
  • You cannot issue cash back
  • You cannot provide refunds on orders
  • The customer must have one’s physical EBT on hand
  • The customer must also have one’s unique PIN ready for handling the card; all EBT transactions require a PIN entry

Train Your Employees

Your employees must understand the rules of the EBT program. Helping them learn about how they use your EBT-compatible equipment. Let them know what items qualify for EBT payments and what doesn’t work. You can contact the USDA for free training guides to help your employees learn the system.

Start Accepting Payments

You can start accepting EBT payments after everything is ready. The customer can swipe one’s EBT card in the POS device and then enter the PIN associated with the card. The employee will then enter the cost of the purchase and complete the deal.

Start Accepting EBT Payments Today!

You can show your community that you care about those who are less fortunate when you accept EBT payments. You’ll be there to support people who need assistance in paying for the foods they need the most.

You will also bring in more business if you start accepting EBT payments. People who are eligible for EBT benefits will begin to take note of your business once they learn more about your work. They’ll want to support your business and let others know about your work. You’ll have a better chance at expanding your business and growing your customer base when you handle EBT payments.

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