A Guide to EBT Merchant Services
The EBT is a swipe or chip card with which purchases can be made. It is called Electronic Benefits Transfer (EBT). It has been in use since 2004. It has been useful in the implementation of the Supplementary Nutritional Assistance Program SNAP. The program provides monthly stipends to low income earning families. It is meant to augment the little that these families earn to ease their survival.
A lot of authorized businesses accept the EBT card as a means of settling payment. It is also a contactless payment scheme. Only that it is limited. It is not only limited by the restrictions on the ability to own and hold the card, It is also restricted in the class of goods it can buy. It can only be used to purchase food and other commodities that are approved by the government. Government has strict guidelines when it comes to the Supplemental Nutrition Assistance Program SNAP. The EBT card can only be used to purchase fruits and vegetables, soft drinks, loaves of bread energy drinks, meats, cereals, fish, sweets, poultry, dairy products, baby food and formula, and non-alcoholic beverages. And it can only be used at stores that are authorized to accept the EBT card. Online stores like Albertsons, Amazon, Safeway, Vons, and Walmart accept EBT. You can also join the league.
This article seeks to help retailers and businesses learn the rudiments of the EBT card and the procedures involved in filing an application for an EBT acceptance permit. In this article, you’ll also learn about the devices required to handle EBT payments.
Just like I stated earlier, there’s a limit to the goods that can be purchased with the card. For businesses that don’t offer these goods, they cannot get the permit from government. If you sell staple foods, you can apply to be granted the ability to accept EBT cards.
Staple foods in the following four categories will qualify you for a permit
1) dairy
2) loaves of bread grains, and cereals
3) fruits and vegetables
4) meat, fish, and poultry.
But note that there is a condition to the food being accepted. Food that is hot when sold, or ready-made like meals sold in restaurants cannot be paid for using EBT cards. The only exception to this rule is if the holder of the card is homeless, disabled or elderly, and has no means to cook meals with. You should also note that you do not necessarily have to sell all these categories of food. You can still get a permit if more than 50% of your gross retail sales come from the sale of one or more of these categories of staple foods. Or at least two of these categories include perishable foods.
If you sell seeds or plants that can be cultivated to produce food for the household, then you can also apply. Items like pet food, soap, cigarettes, paper, alcoholic beverages, vitamins or medicines, cosmetics, laundry products, or other household products are not allowed.
As a Farm stand, farmers’ market, or CSA (Consumer Supported Agriculture), you can also apply to be granted the permission to accept EBT cards. To gain authority, Farm stands apply as individual retailers while Farmers’ markets are required to apply as a group. They apply for a central SNAP retailer license which can be used by all the vendors at the market. And CSAs are required to file for a permit as a single business.
If you qualify to accept EBTs based on the rules and guidelines listed, then the next step is to get your SNAP permit. The process of running the permit is free. To get the 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. Note that every individual store you own must have a permit (this is for people who have multiple stores) and these permits must be in your name.
To apply for the permit, fill the online store application through the FNS online form. Documents needed for the process include
- A copy of your business license. Make sure the license is recent. An example is sales tax permit or health permit.
- You will also need your driver’s license. Send a scanned copy of all page sides of the license. (If you’ll be submitting electronically).
- Then a passport or any other means of photo identification.
- Your bank’s name and address
- Your merchant account provider’s information (name, phone number, address, and website).
- You need a copy of the Social Security cards for your business partners, officers, and shareholders, and even your spouse.
These documents have to either be sent to the FNS office physically or online. For the option of physical submission, you’ll find their address on their website.
Prepare for inspection, because during the process, the FNS office will either send an official to visit your store or just call you for more information.
After submitting the application, you can always check the status of your application online. It takes only 45 days to get an acceptance or decline of application. If your store gets declined as a result of non-eligibilty, then you can’t reapply until a 6 months time lapse.
If your application gets approved, a seven-digit FNS account number will be issued to you. With this, you’ll be inducted as an FNS-approved business. Once this is done, all you need to do is to reconfigure your processing equipment to accept SNAP payments.
You can call the FNS toll-free number 1-877-823-4369 for inquiries
EBT works like debit cards. When customers pay with their card, the amount gets subtracted from their EBT account and credited to your store’s bank account. It takes two business days for the transfer to occur. The same devices that process debit cards and credit cards also process EBT cards. Businesses that don’t have equipment that processes electronic money transfers, cannot accept EBT transactions.
Do not lose out on sales to customers that are on government assistance. They are always a substantial percentage of the population in each state. From a survey, 30% of stores have lost sales to their lack of the ability to accept EBT.
