Another Risk For SNAP Beneficiaries

The Lempert Report
January 10, 2019

NPR reports that while using food stamps to purchase vegetables at a farmers market may seem like a simple exchange, it depends on complex government contracting requirements and increasingly sophisticated technology.

A change this year, according to NPR, in federal contracts has left some farmers market operators and advocates nervous. A company that has long provided the technology to 1,700 farmers markets across the country that accept benefits from the Supplemental Nutrition Assistance Program (SNAP), or food stamps, says it is pulling out of the business.  

Earlier this year, federal officials picked a new contractor to provide equipment to help expand the number of markets that handle SNAP transactions. That contractor, when choosing the companies it would work with, did not include theNovo Dia Group, whose Mobil Market+ app is popular with many markets. After that, Novo Dia announced it would no longer provide its service, even to existing clients, after July of this year. 

The change was part of a competitive contracting process, according to the U.S. Department of Agriculture, which both promotes American farmers markets and oversees the federal SNAP program. Every few years, USDA's Food and Nutrition Service selects a firm to manage the wireless processing equipment program for farmers markets and farmers who want to begin accepting SNAP benefits. In March of this year, it selected Financial Transaction Management who says it focused on cost effectiveness and compliance with standards that protect farmers markets from liability in the event of a data breach.

Improving access to fresh food has long been a goal of the Food and Nutrition Service. It champions farmers markets as an important way to provide people with nutritious food while also supporting farmers. And SNAP has boosted sales at the markets. SNAP benefit redemptions by farmers and markets grew by more than a third from 2012 to 2017, to a total of $22.4 million, according to USDA.