Forage, a payments processor that makes it easier for grocers to accept SNAP electronic benefit transfer (EBT) payments online, raised $22 million in a funding round that included Instacart’s founder, the company announced Monday.
The Series A funding round was led by finance-technology firm Nyca, with participation from PayPal Ventures, EO Ventures and Instacart’s Apoorva Mehta. The San Francisco-based payments company will use the cash infusion for product development and hiring, the company said.
“This capital will help accelerate Forage’s mission to democratize access to government benefits,” Forage co-founder and CEO Ofek Lavian said in a statement. “We’re proud of the technology we’ve built and are excited to expand the acceptance of SNAP EBT payments online for low-income Americans.”
Commonly known as SNAP, the Supplemental Nutrition Assistance Program began in 1939, the tail end of the Great Depression, as the country’s first Food Stamp Program. The program has evolved over the years but has always focused on helping low-income adults and children purchase food.
More than 250,000 locations accept SNAP benefits in-store, but a much smaller amount can take the payments online. One in eight Americans receive government assistance to buy groceries.
“Many SNAP recipients are homebound, lack transportation, or live in a food desert without easy access to grocery stores; many others want to avoid in-person shopping due to concerns about COVID,” Forage said in a statement. “While many Americans were able to shift to online grocery shopping during the pandemic, SNAP recipients were not afforded this safety and convenience because they are effectively unable to use their benefits online.”
Last month, Instacart announced it would expand its EBT SNAP coverage for online groceries to almost the entire country after it added 10 additional states to its roster.
Boise, Idaho-based Albertsons Cos. And Phoenix-based Sprouts Farmers Market were among the first grocers to accept SNAP payments in the new markets.
Forage also recently launched a Shopify app to offer online SNAP EBT processing to the platform’s merchants, the company said.