Across the United States, 22 percent of food-insecure households fall under the Supplemental Nutrition Assistance Program (SNAP) — what we used to call food stamps — totaling $126 billion in food assistance per year. However, the spending power that the program allocates monthly is often held back due to a largely analog, physical-only system.
“People on food stamps have mobile phones and are tech-savvy. By having access to use the latest mobile technology and apps to order healthy food, they are able to live healthier lives and take control of their finances,” says Eli Calderón Morin, founder and CEO of All_ebt, a smart wallet for food stamps.
SNAP assistance is currently administered with a physical Electronic Benefits Transfer (EBT) card that can only be used at select brick-and-mortar stores. Busy families, elderly individuals, and persons with disabilities are unable to take advantage of the digital economy to save time and transportation costs.
With All_ebt, the user creates a free account via Facebook Messenger and uploads a photo of their EBT card or WIC coupon. That information is added to a virtual wallet and can instantly be used to purchase groceries that adhere to the SNAP restrictions. The money isn’t actually being transferred over the platform, shares Morin; rather, it provides approval to charge the amount necessary for groceries.
The low-income neighborhoods where many SNAP-assisted individuals live often have limited access to well-stocked grocery stores, a phenomenon known as a food desert. That makes access to Amazon Fresh or Instacart even more valuable.
“I grew up on food stamps as a kid. After working in Silicon Valley for over 10 years at startups that were acquired by Google and Amazon, I decided that this was a problem that nobody was going to solve,” says Morin. “I had to solve this problem for the local community, family, and friends living on food stamps.”
“They [SNAP users] have tremendous purchasing power in aggregate, yet remain underserved by consumer technology,” says Morin.
Morin founded the company in Los Angeles, and after attending Charlotte’s Queen City Fintech Accelerator, created a second outpost in the North Carolina city. They’re focusing on three markets: the Southeast, the West Coast and Puerto Rico.
To help sign up users and validate the idea, they’ve set pop-up market stores in LA and Charlotte stocked with essentials.
The team is working with VISA and payment platform Marqeta to create secure, branded All_ebt virtual cards and build the platform’s back-end infrastructure. They were finalists in the Visa Platform Challenge, part of the VISA developer program.
“We know this is a highly regulated space but once we are established, these regulations actually acts as a barrier of entry for other competitors, giving us a significant first move advantage,” says Morin.
Cornering that market will allow the start to become, as Morin puts it, the “Stripe for EBT transactions.” All_ebt is currently bootstrapped and charges a 2.9 percent fee to the merchant for every transaction as its revenue model.
Following the close of a seed round, All_ebt plans to expand their Charlotte-based team and scale across the country.