Offering grant to increase number and diversity of retailers offering online shopping to SNAP participants

FROM THE UNITED STATES DEPARTMENT OF AGRICULTURE’S (USDA’S) FOOD AND NUTRITION SERVICE – The USDA announced on July 7, 2022, that it is seeking applications for a $5 million competitive grant to help expand the number of retailers that offer online SNAP (aka, Supplemental Nutrition Assistance Program) shopping. The SNAP Electronic Benefit Transfer (EBT) Modernization Technical Assistance Center grant will fund an organization to provide extensive support to retailers with the technology and systems needed for SNAP online shopping so that SNAP participants can access a larger diversity of retailers while shopping for groceries online.

“Online grocery shopping is a vital resource that improves access and convenience for all, including low-income families,” said Stacy Dean, USDA’s deputy undersecretary for food, nutrition, and consumer services. “We are excited about this grant’s potential to provide new and existing retailers with tools to redeem SNAP benefits in ways that improve customer service for SNAP participants, especially those that face barriers in traveling to a physical store.”

The retailers who were first to offer SNAP online purchasing typically were larger grocery chains with established online shopping offerings to use as a foundation. Many retailers, especially smaller ones, face technical challenges or a lack of resources to deploy e-commerce sites or update existing sites, that allow them to provide online services that meet SNAP requirements. Through this grant opportunity, USDA hopes the technical support provided will help these smaller, independent stores offer online purchasing for SNAP participants. USDA also hopes to see an expansion of stores offering online shipping to give SNAP participants more choice, better serve rural communities, and meet cultural food preferences.

In May 2022, just over 3 million SNAP households shopped online, which is a substantial increase from March 2020, when about 35,000 SNAP households shopped online. This is due in large part to USDA’s swift expansion of the pilot program at the onset of the pandemic, adding approximately 130 retailers, representing thousands of stores, in the past two years.

“SNAP online purchasing is particularly important to the communities we serve because of continued fear of contracting COVID-19 in a grocery store, the risk of exposure to other transmissible diseases, accessibility issues both in store and with transportation, and pre-existing burdens on family caregivers,” said Cyrus Huncharek, senior public policy analyst at the National Disability Rights Network. “We appreciate USDA’s thoughtfulness and stewardship of this crucial technical assistance.”

This grant is funded by the American Rescue Plan. The request for applications opened July 7, and all applications must be submitted by 11:59 PM EST, Sept. 6, 2022. The grant will be announced in fall 2022. For more information, please visit www.grants.gov.

This grant aligns with broader actions to modernize SNAP and ensure participants have access to the same shopping experience as the rest of America. USDA is currently developing a pilot program to allow SNAP consumers to use their phones to purchase groceries at the checkout counter and will soon seek states to participate in this pilot.

USDA’s Food and Nutrition Service (FNS) leverages its 15 nutrition assistance programs to ensure that children, low-income individuals, and families have opportunities for a better future through equitable access to safe, healthy, and nutritious food, while building a more resilient food system. Under the leadership of Secretary Tom Vilsack, FNS is fighting to end food and nutrition insecurity for all through programs such as SNAP, school meals, and WIC. FNS also provides science-based nutrition recommendations through the co-development of the Dietary Guidelines for Americans. To learn more, visit www.fns.usda.gov and follow @USDANutrition.

The 2014 Farm Bill (PL 113-79) mandated a pilot be conducted to test the feasibility and implications of allowing retail food stores to accept SNAP benefits through online transactions. For households to make online purchases, the online shopping and payment pilot is required to be secure, private, easy to use, and provide similar support to that found for SNAP transactions in a retail store. Benefits cannot be used to pay for fees of any type, such as delivery, service, or convenience fees. The pilot will involve at least five online retailers in at least three states. The goal is to ensure that the foundational infrastructure necessary for running SNAP transactions online operates in a safe and secure manner.

Online Supplemental Nutrition Assistance Program (SNAP) Purchasing Grew Substantially in 2020

 By Jordan W. Jones, USDA, ERS, Amber Waves, July 6, 2021

The SNAP Online Purchasing Pilot allows households in participating States to use their SNAP benefits to purchase groceries online from authorized, participating retailers. The pilot was mandated by the 2014 Farm Bill and was intended to test the feasibility of safe and secure online SNAP benefit redemptions. Online transactions are subject to the same requirements as in-person benefit transactions. Benefits can only be spent on food at home and cannot be used for additional expenses tied to online grocery shopping, such as tips or fees. Online SNAP grocery purchases can be delivered or picked up onsite like other online grocery purchases.

The USDA, Food and Nutrition Service (FNS) originally selected eight states to participate in the SNAP Online Purchasing Pilot in coordination with selected retailers and State agencies. The pilot initially launched in New York State in April 2019. It expanded next to Washington in January 2020, followed by Alabama, Oregon, and Iowa in early March 2020 and Nebraska on April 1, 2020. In response to the onset of the Coronavirus (COVID-19) pandemic and the need for social distancing, FNS worked with States and retailers to rapidly expand the pilot to additional States, providing access to more recipients of SNAP and Pandemic Electronic Benefit Transfer (P-EBT)—a program providing benefits spent much like SNAP to households with children missing in-person free or reduced-price school meals. From March to June 2020, the pilot grew quickly from five States to 39 (including Washington, DC). More than 90 percent of SNAP participants were estimated to live in States that had implemented the pilot by June. By the end of 2020, the pilot was live in 47 States (including Washington, DC). Online SNAP purchasing later became available in Maine in March 2021. Three remaining States (Alaska, Louisiana, and Montana) have yet to implement the pilot as of June 2021.

As access to the pilot expanded over 2020, so did use of online SNAP purchasing. In February 2020, the earliest month for which data are available, households redeemed less than $3 million in SNAP benefits online, accounting for less than 0.1 percent of all benefits redeemed that month. This value grew especially rapidly through June 2020, when online SNAP and P-EBT redemptions totaled $154 million, or 1.6 percent of total redemptions. Online redemptions grew each subsequent month through December 2020 to $246 million—86 times the value in February. In addition to expanding access to the pilot, this growth reflects other factors, such as changing demand for online grocery purchasing caused by the pandemic. Despite this rapid growth, online redemptions still made up a small share compared to in-store redemptions—only 3.0 percent of the total $8.1 billion in benefits redeemed in December 2020. Overall, households redeemed $1.5 billion in benefits online from February to December 2020.