The EBT/Food Stamp Benefits Authorization Process
As many of you are aware, the majority of our customers pay cash or via credit/debit cards for their purchases. However, the number of customers using the Supplemental Nutrition Assistance Program (SNAP)—previously known as food stamps—has risen significantly in recent years due to the soft economy and high unemployment rate, and they are as important as any of our other customers.
Our stores have been participating in the SNAP/food stamps program since the paper days, and switched to the new system when state governments decided to go with Electronic Balance Transfer (EBT) in order to control the abuse associated with paper food stamps. The new system is more convenient as food stamp booklets have been eliminated and the new cards can be used in different cities and states through electronic processors or pin pads. I think we can all agree that the EBT system is very convenient for customers and retailers compared to the old paper system.
The U.S. Department of Agriculture authorized J.P. Morgan Chase EFS to handle the EBT transactions through their system, and it reimburses retailers through Automated Clearing House, which processes debit and credit cards between participating financial institutions. The new food stamps system is better than the old one—a store applies for a SNAP license through the Department of Agriculture and upon approval J.P. Morgan sends the equipment. After a little training the store is able to handle the transactions and you are in the business of accepting EBT food stamp cards as payment. However, the EBT machine is another piece of equipment to take care of and it is not integrated into our POS system.
After scanning the items to be purchased through your cash register, you have to input all the information into the SNAP EBT machine to obtain authorization and balance the register transaction. Sales associates have to save the receipts from their shifts for reconciliation, as most of the time there is a difference in cash register transactions and EBT machine totals. EBT food stamp cards have a certain money amount loaded into them, so it is always a forced balance during daily cash report preparations when transactions authorized by the EBT machine do not match our cash registers. Regrettably, the EBT machine day-close amount and the cash register day-close amount rarely match, even if you reset your timing with J.P. Morgan’s close time as per Eastern Time Zone. Therefore, forced balance is the only option.
Additionally, most 7-Eleven stores have only one phone line and everything is connected to it—including EBT machines—so store personnel cannot use the phone line during EBT transaction authorization. SEI has agreed to install separate phone lines for EBT machines in those stores that have only one phone line. Franchisees have to fill a Field Telecom request form and get it approved by their Market Manager. SEI will pay for installation of the phone line and the monthly charges. Franchisees may contact Telecom at 1-800-848-0711, prompt 3 or contact Patti.Barnes@7-11.com or 972-828-2865.
Integration of EBT transactions into our POS system is the only solution for all these problems, and it can be installed into our current POS equipment by credit/debit card processors hired by SEI in conjunction with J.P. Morgan EFS’ EBT authorization system. Franchisees may visit the J.P. Morgan Chase website for more information (www.ebtretailerinfo.JPmorgan.com). You may contact me with any questions on this issue at jksingh2003@yahoo.com or 702-249-3301.
Happy selling!