Does Square Accept EBT?

When looking for a merchant services solution, business owners often have questions, such as:

  • Does the merchant services provider offer compatible equipment?
  • Does the merchant services provider offer multiple payment methods, such as mobile wallets?
  • Can I accept American Express? Discover? Military cards?
  • Does Square accept EBT?
  • How to accept EBT with Square?
  • How much does it cost?

Square is one of the most recognizable names in payments today, possibly due to the slew of payment methods they say their equipment can process. But what about electronic benefits transfer (EBT) cards? Does Square accept EBT? If so, is there a trick to how to accept EBT with Square?

Even though Square is a household name, services and availability vary drastically among business owners who use Square for payment processing. For instance, some users say their payment portal only accepts branded credit and debit cards — not prepaid cards. Other customers chose Square so they could offer customers in-store gift cards, but they claim this functionality doesn’t always work. And still, others claim Square closed its account unexpectedly.

Electronic benefits transfer (EBT) cards: Does Square accept EBT?

Well, it’s tricky, and until recently, the answer was no. Square doesn’t actually accept EBT card payments, per se.

Square has never accepted electronic benefits transfer payments. But if you want to get technical, they recently reported that, while Square still doesn’t accept EBT card payments, the answer is yes for store owners who have Square hardware with the TotilPay app or are partnered with a merchant account services provider that accepts EBT card payments. In that sense, you can accept EBT card payments with Square. You just have to download an app from Square’s Marketplace and use it in place of the Square App when processing EBT card payments or partner with an EBT merchant account provider like Bankcard.

What’s EBT?

EBT stands for electronic benefits transfer. It’s a system similar to traditional credit and debit cards that facilitates transferring assistance funds to qualified individuals.

The two main categories of EBT assistance are cash and food benefits (formerly known as food stamps). The Supplemental Nutrition Assistance Program (SNAP) provides food benefits to recipients who qualify for the program due to low income, so they can purchase food for themselves and others in their households. SNAP recipients are only allowed to buy eligible food items, however. Hot food items, like fried chicken at the local deli, don’t qualify as an eligible food items.

The greatest difference between EBT cards, debit cards, and prepaid cards is that EBT card transactions are processed through an entirely different network. Square doesn’t participate in this network except through the integration of the TotilPay app.

What’s TotilPay?

Some point-of-sale machines require transactions to be separated. For instance, if a customer has a mix of items in their order and is paying with EBT Food benefits and cash, the food items must be paid for first in one transaction and the cash items paid for separately in a subsequent transaction. TotilPay is an intuitive all-in-one POS system that lets retailers accept all forms of payment, including any EBT card transaction, cash, check, credit cards, debit cards, and more, while keeping all items in a single transaction. Square retailers who want to accept EBT payments on their Square POS system must add the TotilPay app to their Square POS.

How does Square work with EBT?

Understandably, business owners looking for a merchant services provider would have concerns about the types of payments they can process. Consumers are evolving as fast as the payments industry, and they want to use their preferred payment method.

Because the transaction is processed on Square equipment connected with your Square account, all sales still get deposited into your Square account.

But Bankcard doesn’t have nearly as many hoops and restraints when it comes to processing electronic benefit transfer cards in grocery stores. You’ll get everything you need to begin accepting EBT cards. With the equipment and processing software built-in, there’s no need to worry that software and hardware won’t match — all for a flat monthly fee and no transaction fees.

Let’s take a look at Square’s software options, EBT transactions functionality, and hardware options.

What does Square offer for software?

When it comes to fundamental features you’d expect in a point-of-sale system; Square’s got your back. Square’s POS systems are preloaded with the software needed for most industries. Square’s software doesn’t accept EBT payments, unfortunately, but you still have options since Bankcard offers low-cost EBT payment processing. Square has four main software programs: Point of Sale, Retail, Restaurants, and Appointments.

While these options have certain things in common, each was built for a specific purpose:

  • Square Point of Sale. This is the original software for the company’s POS systems. It can be tailored to work with any type of business, but it works best for businesses that don’t need a lot of bells and whistles as far as added features. You might see this option in a small grocery or convenience store.
  • Square for Retail. This software is tailored to retail businesses, offering functionality geared toward retail establishments, such as clothing shops.
  • Square for Restaurants. Square for Restaurants is to your local diner what Square for Retail is to department stores. This software was created for the special requirements of dining establishments and can support both fronts- and back-of-house, even online ordering, pickup, and delivery.
  • Square Appointments. This software is perfect for any business that accepts clients by appointments, such as hair and nail salons, doctors’ offices, and even mechanic shops. Customers can book their own appointments based on the proprietor’s preset availability, and salon owners can stay on top of scheduling.

Each of Square’s POS systems has a free tier, though larger businesses with higher sales may need one of Square’s flexible monthly subscriptions. Monthly pricing varies depending on the POS system you choose and monthly sales amounts. Bankcard specializes in high-risk merchant accounts, but you also have options for zero-cost payment processing.

Square’s POS software: What does it offer?

Each of the above POS systems comes with the following items or functionalities standards:

  • Inventory management
  • Tracking and analytics
  • Customer relationship management (CRM)

For additional monthly fees, you can also add on other features, such as:

  • Employee scheduling and timekeeping starting at 5 USD/mo.
  • Company payroll starts at 35 USD/mo., a flat fee you pay for the service, plus an additional 5 USD/person/mo. for each person on that month’s payroll.
  • Loyalty program starting at 45 USD/mo.
  • Gift cards are as low as free (for digital eGift cards) up to 0.95 USD/card if you purchase cards designed through Square.

What card payments does Square support?

Judging by the names — Visa, Mastercard, American Express, and others — it appears there’s no card that Square doesn’t accept. However, most merchant service providers use payment processing techniques that accept credit cards, debit cards, and prepaid cards. That’s good, right?

Well, for the most part, yes. Here’s the gist:

Credit and debit cards

Businesses typically can only run a credit card as a credit card unless the specific card company offers its customers PIN-supported payments. Even in the latter case, the store’s equipment must be set up to handle a credit card PIN purchase.

On the other hand, processors can run debit cards as either credit or debit, depending on customers’ preferences. Businesses usually like to run debit cards as debit purchases because payment processing fees tend to be lower than for credit card purchases.

Prepaid cards

Prepaid cards are similar to debit cards in the sense that only the amount of money that’s been loaded on the card is available for use. Some merchant services providers, however, are unable to accept prepaid cards due to the fraud protection built into their payment systems for security. Prepaid cards often don’t show the cardholder’s name and have no address on file to prove the cardholder’s residency or proof of card ownership.

Square can accept prepaid cards, but due to the regulations mentioned above, if a shopper hasn’t connected their home address — not a PO Box — to their prepaid card, Square’s payment processing will decline the card.

Okay, but EBT cards are prepaid cards, right? In this sense, no, because EBT cards are processed through a different payment network that Square doesn’t participate in.

Get approved for a high risk merchant account fast!

How to accept EBT with Square

To accept EBT card payments if you’re a Square customer, you must connect your Square account to a third-party app called TotilPay, which is a point-of-sale (POS) application that integrates with your Square payment processing. Once you connect TotilPay to an existing Square account — provided you already have your FNS number from the USDA — you can use your current Square Terminal to accept all the above card types, including:

  • Credit cards
  • Debit cards
  • Prepaid cards (may not work on some occasions)
  • Supplemental Nutrition Assistance Program (SNAP) EBT card accounts
  • Temporary Assistance to Needy Families (TANF) EBT card accounts
  • Women, Infants, and Children (WIC) payment cards
  • ApplePay and other mobile wallets
  • Some government and military cards

You can process all these card types, but does Square accept EBT? Square doesn’t yet offer this functionality as part of their own native app, so if you are processing sales with a mix of the above card types and EBT cards, connecting your Square account with a merchant services provider like Bankcard could work for your business. Everything you need to get set up to accept EBT payments is included for just one low monthly fee — with no transaction fees.

What does Square offer for hardware?

Square has many hardware options, and your choice depends on your budget and/or the processing speed you need for your specific business. For example, if you have a high-volume business, the Square Register or the 2nd Gen Square Stand might be right for you.

Here’s Square’s current point-of-sale options:

  • Square Register, which accepts all types of payments.
  • 1st Gen Square Stand works with an iPad and uses the Square POS app, preinstalled. It also comes with a Square Reader and a Dock.
  • 2nd Gen Square Stand, which is similar to the original Stand, but the second entry in the Stand generation has the payment terminal built-in. Store owners can accept contactless and chip payments, but one of the updates with this generation was the removal of the magnetic card stripe reader. If you need swipe functionality, you’ll need to get the Square Reader in addition to this Stand.
  • Square Terminal, which offers all the functionality of the Stand with the mobility of the Reader in an all-in-one solution. You can process card payments and print receipts for customers.
  • Square Contactless & Chip Reader offers both chip and near field communications payments, or the famous “hold your phone over the card reader to pay” capability.
  • Magnetic Strip Square Reader, the OG of Square’s payment processing devices. This magstripe reader connects to any iPhone or iPad and has payment processing functionality from the moment you download the app and connect to the Square App. Is it brand new to Square? They give you your first magstripe card reader for free.

Partnering with Bankcard for EBT payment processing

It’s hard to understand all the different payment terminology and equipment available, much less decide on the EBT payment processing equipment you need to make it happen. Navigating EBT cards and SNAP payments is complicated, and we’re here to help.

Reach out to Bankcard, and we’ll walk you through the entire checklist of items to get you up and running with accepting EBT and SNAP benefit payments.