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Accepting EBT at Minnesota Farmers Markets

Do you operate a farmers market in Minnesota? Are you a vendor at one? Have you thought about accepting EBT cards, but don’t know how to get things set up? This guide will walk you through all the steps necessary to accept EBT cards at a farmers market in Minnesota — everything from applying for SNAP retailer status with the USDA to engaging community partners in promoting this service. Whatever your interest in farmers markets, this guide offers expert and practical advice on accepting EBT cards. Read the entire guide online, starting below, or download a copy of the full guide in print form: Accepting EBT at Minnesota Farmers Markets (PDF).

The Role of SNAP and EBT

Many families in Minnesota face significant barriers to buying healthy foods at farmers markets, with affordability probably the biggest impediment. Fortunately, the Supplemental Nutrition Assistance Program (SNAP), previously known as the Food Stamp Program, can help low-income individuals and families gain access to fresh, healthy, locally produced foods. One in seven Americans participates in SNAP annually, with roughly $75 billion in SNAP funds going to recipients nationwide.

Administered by the Food and Nutrition Service (FNS) of the U.S. Department of Agriculture, SNAP enables low-income Americans to pay for food via the Electronic Benefit Transfer (EBT) system. EBT allows SNAP recipients to authorize transfer of their government benefits from a federal account to a retailer account to pay for products received.

This is a win-win situation for both parties involved. Local farmers benefit financially, and low-income individuals and families gain much-needed access to healthy foods. As of early 2015, more than 65 farmers markets in Minnesota accepted SNAP benefits via EBT cards. If you operate a farmers market in Minnesota, why not add your business to the list?

Apply to Become a SNAP EBT Retailer

In order for participating vendors to accept EBT cards at your farmers market, you first must become licensed by FNS. Applying to accept SNAP benefits (via EBT cards) at your farmers market is a three-step process: 1) obtain a USDA account, 2) fill out an application online, and 3) mail supporting documentation to complete your file to USDA.

Social Security Number Requirement

Most retailers, including most farmers markets, are legally required to file a Social Security number when applying for an FNS license to accept SNAP benefits. FNS keeps Social Security numbers confidential — they are collected only to help prevent fraud. Most farmers markets submit the Social Security number of the chair of the market's board of directors, but remember — this makes the individual submitting his or her Social Security number the "responsible party" for the EBT acceptance process and service provider contract. This is something very important to consider and talk through before completing the FNS application. Note that there are three types of farmers market structures that are exempt from the Social Security number requirement: 1) markets that are a 501c3 tax-exempt non-profit organization, 2) markets that are operated by city or county government, and 3) markets that are operated by state colleges or universities.

Timeline and Getting Started

FNS may take up to 45 days to process an application once it's submitted, although the average timeline for certification from start to finish is one month. For more information and to apply for an FNS license to accept SNAP benefits, visit the SNAP Retail Merchants webpage on the USDA website. If you don't have internet access, you may call the FNS toll-free hotline for more information: 1-877-823-4369.

Eligible, Ineligible Items

SNAP participants can use an EBT card to purchase the following foods:

SNAP participants cannot use an EBT card to purchase the following items:

Required Equipment, Supplies, and Staff

A farmers market needs certain equipment, supplies, and staff in order to accept SNAP benefits.

  • Wireless POS terminal. Most markets choose to buy or lease their own commercial POS terminals that accept EBT, debit, and credit cards on the same machine. You might want to partner with your existing bank or other local banks on buying or leasing a terminal — they may be willing to give you a discount on costs in exchange for advertising at your market. See “Covering Costs” below for information on grants available for buying or leasing wireless terminals.
  • Scrip to exchange with individual vendors. Farmers markets may issue scrip either as paper certificates or tokens.
  • Staff person (paid or volunteer) to manage the central POS terminal and scrip distribution, as well as collect stall fees and work with vendors to answer questions or address conflicts. This person is usually called the market manager, and he or she focuses on all market operations — with responsibilities beyond EBT acceptance. Some markets also may employ a terminal manager whose specific task is to operate the POS terminal and distribute scrip.

Covering Costs

The Minnesota Department of Human Services offers grants for buying or leasing wireless terminals that accept EBT, debit, and credit cards.

The remaining costs associated with transaction fees or other fees related to using the terminal must be covered by your farmers market. These costs vary depending on your service provider and include a fee for every time an EBT, debit, or credit card is swiped, as well as monthly and annual fees. You may be able to obtain discounts on terminal fees by partnering with your existing bank or other local banks in exchange for advertising at your market.

Use of Scrip at Farmers Markets

Use of scrip enables multiple vendors to accept payment from both SNAP and non-SNAP customers at a farmers market. Customers receive scrip after swiping an EBT, debit, or credit card at a central POS terminal that is connected to the farmers market bank account where money is directly deposited, usually within two business days.

Once a transaction is approved, the machine issues a transaction receipt, which the customer then presents to the market manager or terminal manager who, in turn, distributes scrip to the customer for redemption at vendors’ stalls. This is where FNS rules governing scrip use and handling come into play:

  • As noted, only eligible foods can be purchased with scrip paid for with an EBT card, i.e., SNAP customers may purchase only eligible foods with their scrip (see box). On the other hand, non-SNAP customers may use their scrip to buy any item sold at the market.
  • Vendors cannot give SNAP customers change for purchases made with scrip. A SNAP sale must total the exact amount of scrip, or the customer can make up the difference with cash. On the other hand, vendors may give change to non-SNAP customers.
    • Because of the change-making rules, it’s best to give units of SNAP scrip a relatively low value so customers don’t have to produce as much cash to make up any price differences.
    • Many farmers market operators in Minnesota assign a $1 value to each unit of SNAP scrip and a $5 value to each unit of non-SNAP scrip.
  • A SNAP customer must be able to get a refund back onto his or her EBT card for unused scrip.
  • If a farmers market accepts debit and credit cards, the scrip given to SNAP customers must be distinct (look different in some way) from scrip given to non-SNAP customers. Each farmers market is responsible for developing or commissioning development of designs to distinguish SNAP from non-SNAP scrip, whether the scrip is in paper form or in tokens.

Some of the rules for handling scrip pose a challenge to protecting the anonymity of SNAP customers; see the “Addressing Stigma” section for more information.

Payment to Vendors

Each farmers market should develop a process for paying vendors in exchange for scrip turned in at the end of the day.

One commonly used process calls for vendors to turn in their scrip at the end of the business day to the market manager, or terminal manager, who then pays them in cash for the scrip they received that day. Other markets may choose to reimburse vendors on a different schedule. There are no requirements from either federal or state authorities on schedules for refunding scrip.

Designing or Creating Scrip

You can contract with various printing and specialty item companies to design and create either paper scrip or tokens for use at your farmers market.

For a list of companies that provide these services, see Appendix E in the USDA publication, “SNAP at Farmers Markets: A How to Handbook.” This publication also contains information about factors to consider when choosing paper scrip or tokens. There are advantages and disadvantages to each.

Addressing Stigma

There’s no doubt EBT cards are a big improvement over the past in reducing the stigma of receiving food assistance because they promote anonymity. Accepting debit and credit cards along with EBT cards further promotes anonymity. However, some FNS rules for handling scrip have the potential to undermine anonymity.

As you might guess, the rules requiring differences in scrip appearances and in handling change for SNAP and non-SNAP customers carry the most risk of revealing the identities of SNAP customers. So what can you, as a farmers market operator, do to protect SNAP customers’ anonymity yet comply with FNS regulations?

Above all, be realistic. Although the appearance of scrip and handling of change for EBT and debit or credit card users should differ, the fact is that only the market (or terminal) manager and individual vendors will be aware of these differences. The majority of shoppers won’t see or notice anything, or they won’t be bothered if they do see something. People using SNAP benefits are most likely their neighbors, after all.

Nevertheless, it’s a good idea to ask your staff and vendors to be sensitive to the differences in handling scrip for SNAP and non-SNAP customers and take care not to embarrass any customers. This is common sense — and good customer relations!

Additional Resources

Katie Spoden
University of Minnesota Extension, Health and Nutrition
AmeriCorps VISTA, Food Access Project
Katie helped create this guide as part of her 2014-2015 AmeriCorps VISTA project with University of Minnesota Extension, Health and Nutrition.

David Nicholson
Minnesota Department of Human Services
David works at the Office of Economic Opportunity with the Minnesota Department of Human Services. He assists farmers markets throughout the state in developing the capability to accept EBT. He is available to walk your farmers market through all steps of the process, connect you with relevant contacts, provide technical assistance, and administer the Market Bucks program for your market.

Sara Cahill
City of Monticello Operations and Program Coordinator
Sara implemented EBT acceptance at the Monticello Farmers Market with help from the Minnesota Department of Human Services and Blue Cross Blue Shield Minnesota. She is willing to share her experience with interested farmers markets.

Grand Rapids Farmers Market

Operators of the Grand Rapids Farmers Market in northern Minnesota have found great success with EBT acceptance, marketing and promotions. Visit their website for more information, or contact them via the form on this webpage:

Related resources

SNAP benefits and EBTU.S. Department of Agriculture — This website provides information about SNAP beneficiaries' use of EBT cards at farmers markets.

Market BucksHunger Solutions Minnesota — This website provides information on its Market Bucks incentive program for EBT users shopping at farmers markets.

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