USDA mandates microchip technology for SNAP benefit cards

The U.S. Department of Agriculture (USDA) has announced a nationwide overhaul of the Supplemental Nutrition Assistance Program (SNAP) payment system. The new rule mandates that all 50 states transition from magnetic stripe Electronic Benefits Transfer (EBT) cards to cards equipped with digital microchips and tap-to-pay technology.

This decision follows investigative reporting revealing that approximately $470 million in SNAP benefits were stolen from recipients last year due to outdated card technology vulnerable to skimming. While some states, such as California, have already implemented chip technology and seen theft rates drop by 83%, more than 40 states still rely on magnetic stripes.

The proposed rule, issued by the USDA’s Food and Nutrition Administration, also establishes new federal “SNAP EBT Operating Standards” to ensure the system evolves alongside modern fraud prevention tactics used in the credit card industry.