EBT (Electronic Benefit Transfer)

What Is Electronic Benefits Transfer (EBT)?

EBT, or electronic benefits transfer, lets people use a payment card for funds they receive from government assistance programs.

EBT Explained

Since 2004, all 50 states in the U.S. have used the EBT program. EBT allows each state’s welfare department to provide nutrition assistance and other benefits via electronic cards.

EBT cards work similarly to debit cards. They are plastic payment cards that the government issues along with a PIN.

Some programs that use EBT cards include SNAP, WIC, and cash benefits.

SNAP (Supplemental Nutrition Assistance Program) refers to nutrition benefits. These benefits used to be issued as food stamps. In 2021, 41.9 million Americans have participated in SNAP.

SNAP users can only use their EBT cards at specific, qualified retailers. They are also limited to purchasing certain products. For example, people can use SNAP to buy fruit, vegetables, and meat, but not alcohol or pet food.

WIC is the federal government’s Special Supplemental Nutrition Program for Women, Infants, and Children. This program aims to provide nutritious foods to infants, young children, and pregnant or breastfeeding mothers.

Cash benefits include programs like TANF (Temporary Assistance for Needy Families). These benefits have fewer restrictions than other programs. Recipients can use cash loaded to an EBT card for needs such as shelter, gas, transportation, and personal care. Specific cash benefit programs vary from state to state.

Not all businesses accept EBT cards. Some business types are more likely to do so, such as grocery stores. If you’re not set up to accept EBT cards, they’ll be declined at the point of sale.

If you operate a business and want to accept EBT, let your merchant account provider know.

Not all terminals and point-of-sale systems support EBT. If yours doesn’t, your processor can help you determine how to proceed. If your system does support EBT, but it isn’t turned on, your processor will help you activate it.

Note that credit card processors cannot legally charge fees for SNAP cards. However, they can add surcharges to transactions on cash benefit cards.

EBT Examples

Michael has a small farm where he grows fruits and vegetables. He has recently started running a stand at the local farmers market on Saturdays. Michael uses a mobile credit card terminal to accept cards.

One Saturday, a customer asks if Michael can accept SNAP. He doesn’t know if he can or not, so he tries running the customer’s card for the purchase. The card is declined.

When he gets home, Michael looks up how to accept SNAP and EBT cards. He finds that the first thing he needs to do is apply to accept EBT cards. He begins his application on the USDA Food and Nutrition Service website.

Next, Michael calls his merchant account provider. He explains that he wants to be able to accept EBT through his mobile terminal.

Michael’s processor walks him through setting up EBT. They complete the steps on their side to activate EBT in his account.

Now, Michael is ready to accept SNAP and other benefits via EBT cards at the farmers market.