Expanding EBT acceptance to level the digital playing field

The growing use of digital payment options has reached more and more consumers. Whether buying groceries at the neighborhood supermarket or purchasing school supplies for children, consumers have tapped into the convenience of paying digitally. However, finding the on-ramp to the digital highway can be challenging for people in underserved communities.

Many Americans rely on government benefits to purchase everyday items, whether it includes groceries to feed their family or other essential items for daily living. The Urban Institute estimates that in the average month, 59 million people, or almost 19 percent of the U.S. population, receives some sort of government-issued assistance – including 24 million children (32 percent of the population under age 18).

These benefits are funded via government programs such as the Supplemental Nutrition Assistance Program (SNAP), Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), Temporary Assistance for Needy Families (TANF, cash assistance), Pandemic EBT (P-EBT) and are distributed via reloadable Electronic Benefits Transfer (EBT) cards that enable consumers to spend these funds at businesses.

Unfortunately, most businesses are not equipped to accept EBT as a payment type outside of a brick-and-mortar environment – greatly limiting a customers’ ability to purchase goods online for delivery or curbside pickup, or even engage via mobile apps. This is because accepting EBT payments online requires use of a digital PIN pad to authenticate each EBT transaction, which many eCommerce infrastructures are not equipped with. With millions of Americans relying on EBT, it is critical that businesses across all verticals explore enabling EBT as a payment option across their digital purchasing channels.

Expanding to EBT Cash Acceptance

While the acceptance of Online EBT as part of the SNAP program is becoming ubiquitous among grocers, the next evolution is extending to government-issued cash benefits – funds that can be used to purchase everyday essentials beyond groceries. These goods could include dinner at a local quick service restaurant, clothing, school supplies, toiletries, household items, the cost of a child’s haircut, or other goods and services that consumers pay for on a regular basis.

Expanding the acceptance of Online EBT to include cash benefits will further democratize access to digital purchasing technology – taking a crucial step forward to leveling the playing field for consumers.

Enabling more consumers to purchase digitally will:

Provide more access to omnichannel purchasing options, such as online ordering for delivery, curbside pickup, buy online pickup in store, or adding EBT acceptance directly to a merchant’s digital wallet
Allow consumers to better engage with a company via digital applications, and realize benefits of loyalty/reward programs, digital promotions, etc.
Enable businesses to better understand their consumer base and buying habits
Reduce cart abandonment by providing additional payment choice to consumers

PIN-on-Glass

All EBT transactions, in-person or online, require the use of the cardholder’s PIN to authenticate the transaction. Leveraging Carat’s proprietary PIN-on-glass solution, businesses can create a digital PINpad within their digital commerce environment that allows EBT cardholders to authenticate their transaction in a secure and simple manner.

With a simple addition to a merchant’s ecommerce tech stack, Carat can help businesses of all types enable EBT SNAP and EBT Cash payments for their customers – opening the digital doors for nearly 20% of the U.S. population to purchase with EBT.

Leading Innovation in Online EBT

Carat is at the forefront of enabling technology that provides equitable access to digital purchasing, and allows consumers to access digital payment options, so they can easily engage with merchants. Doing so allows businesses to better serve these customers, and ultimately drive more commerce.

We became the first company to enable grocers to accept EBT Food payments online in 2019 via the USDA’s SNAP Online Purchasing Pilot. As the pandemic accelerated digital commerce adoption across the grocery industry in 2020, grocers were able to use Carat to access a simple digital PIN solution that enabled grocers to accept EBT payments online for groceries for the first time. By the end of 2021, our pilot grew to see nearly one million transactions per day processed by Carat – including industry leaders such as ALDI, Amazon, HEB, ShopRite, Walmart, and others.