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It takes more than a snap of the fingers to participate in SNAP, the Supplemental Nutritional Assistance Program. In fact, businesses must be authorized to participate and with some exceptions, have to pay for the equipment that allows them to participate in the government benefits program, commonly called "food stamps."
But it can mean more customers and added revenue, too. So let's take a look at how SNAP works for stores, according to the federal government.
How Does SNAP Work?
Customers who are eligible for SNAP will receive an EBT card. The electronic benefits card works like a debit card for the customer and can be used to buy food at any store that is authorized to accept benefits.
Just as a debit card holder would do, the EBT card holder swipes the card in a Point of Sale device and enters a Person Identification Number (PIN), and transactions are then electronically purchased. Unlike other purchases, however, the US Department of Agriculture has access to records of all transactions (probably to ensure that retailers do not unreasonably hike prices).
How Do I Get the Equipment?
You may be able to use your existent POS equipment, as some machines do allow debit, credit, and EBT transactions. Each state has an EBT processor and can provide more information about how to get the equipment and start offering services.
Some states do have EBT-only machines and process only these transactions. And there are also some exceptions to the requirement that a business pay for the equipment for farmers' markets, direct marketing farmers, military commissaries, non-profit food buying cooperatives and community meal services and programs.
How Do I Get Authorized?
You can apply to be an authorized SNAP retailer online and the USDA says it can take as little as 15 minutes to complete the application. You will, however, have to mail in supporting documentation. If you have any problems with your application or a SNAP situation you do not know how to handle, the USDA has a help line. Call the SNAP Retail Service Center ay 1-877-823-4369.
Consult With Counsel
If you are interested in SNAP but concerned about the application process or any consequences of your participation, speak to a business or commercial lawyer. Counsel can guide you through the administrative process, ensure your forms are all correct, and advise you on all aspects of business operations.