Forage’s paytech is at the intersection of modernizing government benefits for the up to 42 million Americans enrolled in SNAP, and 250,000 merchants who accept EBT, across 50 states.
In addition to the existential risks that come from proposed federal budget cuts, the crossroads for public programs puts burgeoning private-sector fintechs modernizing benefits like the Supplemental Nutrition Assistance Program (SNAP) in a tricky spot.
One in eight people in the United States receives government assistance, such as SNAP benefits, to purchase groceries. Primarily funded by the federal government but administered by states and territories, SNAP is one of several public-benefits programs under scrutiny and poised for funding cuts by the Trump Administration (in concert with Congress) under the guise of attacking “fraud, waste, and abuse.”
To make sense of the volatility and impacts to the sector, Fintech Nexus spoke with Victor Fimbres, Co-Founder and CTO of Forage, a San Francisco-based payments company that helps businesses accept government benefits through a single UPI, and lets benefits recipients use their funds to purchase groceries online.
The following has been edited for length and clarity.
Technologically speaking, what is it like to work with the current government rails that facilitate EBT/SNAP? Namely, do they differ state-by-state, and do they have reliable uptime?
Think of EBT as a payment network. Like any network, it has two sides: the card issuer and the merchant. In the case of EBT SNAP, the card program is federally funded but state-managed, meaning each state effectively acts as its own card issuer. Our role in the ecosystem is to help merchants connect to this network so they can accept EBT payments across states.
While EBT SNAP transactions follow a shared standard in their operation, implementations vary by state. These nuances create real technical challenges when trying to operate at scale, which is why we exist. Forage partners with national brands operating in multiple states. Activating EBT acceptance across all locations isn’t always a smooth process. For instance, sometimes a merchant’s identification number doesn’t propagate across all the systems, and we have to intervene directly with the network to resolve it.
Another layer of complexity is response codes. Like other payment networks, transactions return response codes to indicate a success or failure. But state-level interpretations of these codes can differ. To manage this, we’ve built a database and observability stack that helps us decode what’s really happening behind a failure, which allows us to work with the networks and improve success rates.
For example, here’s a story about one of our online grocery stores that operates across the US. When they launched, we experienced issues related to fraud prevention rules that were built before online groceries were a thing. Our grocery partner is based in California, but they deliver groceries from warehouses throughout the country. They were facing an unusually high error rate when delivering to states outside of California. That’s because some states like Oregon were flagging out-of-state purchases as potential fraud, even though these were legitimate online orders. And you can imagine that Oregon wasn’t wrong — it is unusual for someone in Oregon to want to buy groceries from Los Angeles, California… in a pre-online world. If you live in Oregon, you normally shop at your local grocery store. We had to work with the processors to resolve this, and we brought the error rate to near zero. The solution we came up with and the partnership that we established with the network provides benefits to all future merchants facing similar issues.
You can imagine from that example that we’ve had 4 years of these sorts of insights. We’ve seen and solved a wide range of these edge cases, and in payments, it’s all about the margins – it’s all about getting to as close to a 100% payment success rate as possible. And that value proposition ladders up to our mission to democratize access to government benefits. When merchants succeed, more people are being fed. Every failed transaction is a missed meal for someone who needs it. That’s what drives us.
Just to be clear: The complexity is simply a byproduct of the structure. There are 50 states and multiple territories, each with their own agency and slight variations on operating rules. It’s hard to coordinate across such a decentralized network. On top of that, there are over 250,000 merchants who accept EBT. The scale is massive with 42 million Americans enrolled in the program.
Given Forage’s function as a bridge between public benefits and private commerce, have you interfaced with members of the new administration to discuss the future of benefits like SNAP? If so, what have those conversations looked like?
We primarily engage with the USDA FNS, the federal agency that administers the SNAP program. We also work closely with the EBT Community Council, a non-profit that convenes both public and private stakeholders to shape the technical and operational standards for the future of benefit delivery.
A key focus of these conversations has been on modernizing the infrastructure that supports EBT. One significant example is the shift from magnetic stripe cards to EMV chip cards, which will improve transaction security and better align EBT with modern payment technologies. California is leading this effort and is expected to complete its rollout by the end of this year.
This modernization is critical, and I’m personally very excited about it because it’s really critical to protecting beneficiaries. Fraud and theft are real threats that weigh heavily on me. When benefits are stolen, someone goes without food. For example, in Q4 of 2024 alone, over $70M in SNAP benefits were stolen. We’ve built a sophisticated fraud detection engine and regularly collaborate with the FNS to refine our fraud rules, but some problems like card skimming can only be solved through network-wide coordination.
How can Forage stay technologically agile to adapt to regulatory changes? (Can you technologically account for governmental volatility?)
From a payments infrastructure standpoint, government volatility hasn’t caused major disruptions. Where we do see its effects is on the operational side — particularly in areas that rely on human interaction, like merchant onboarding and go-live approvals.
Lately, volatility has shown up as reduced headcount within agencies, which naturally slows down the merchant approval process. We’ve worked closely with these agencies to evolve onboarding workflows, especially for newer merchant categories like online grocers, which previously didn’t exist within the SNAP framework.
In practice, this means we’ve developed a deep understanding of compliance expectations. When our merchants submit documentation, it’s already formatted to match what agencies require: clean, clear, and ready for review. This drastically reduces the burden on agency teams and helps our merchants get approved faster.
DOGE employees have gained extensive access to government systems containing Americans’ sensitive personal data and many are rightly concerned data could be altered or leaked. How are you thinking about dealing with this sensitive information, and how do you build trust with partners and end users at a fraught moment — when they are seeking vital services, but may be anxious about doing so.
That’s an important question, and I think it’s helpful to first clarify what we do and don’t have access to at Forage. We are not involved in issuing SNAP benefits or managing cardholder data, which means we don’t handle very sensitive personally identifiable information about beneficiaries. Our role is to enable EBT cardholders to use their benefits online — to provide access, not store or control their information. That separation is a core design principle of our payment system. And because we don’t touch sensitive data like that, users can shop online without worrying about us compromising their privacy.
What’s Forage’s roadmap for 2025?
There’s a quote from J.J. Watt that really resonates with how we approach our work: “Success isn’t owned, it’s leased, and rent is due every day.” I think that perfectly captures how we think about reliability at scale. Last quarter, we saw nearly 200% growth in transaction volume, and we’re projecting similarly aggressive growth throughout 2025. With that scale comes increased responsibility. Again, every failed transaction costs someone a meal. Our roadmap is focused on ensuring our systems support and infrastructure scale just as fast, if not faster, than our growth.
We’re also evangelizing online groceries. There are two sides to this. One is the merchant side, which is, “How do we power every single grocery checkout in the country?” On the consumer side, it’s “How do we introduce shoppers to the benefits of online grocery?”
Finally, we’re expanding into similar benefit cards beyond EBT SNAP. SNAP is a restricted-use card limited to grocery purchases, but there are several other restricted card types that align with our mission and infrastructure. Much of the compliance and payments infrastructure we’ve built for EBT SNAP is highly transferable.
It’s also about broadening our mission. We’re moving beyond food access to support overall health and wellness, helping people make better, healthier choices. Whether it’s nutritious food or health-related essentials, we see these benefit programs as powerful tools to improve lives. And we want Forage to be the infrastructure that makes them accessible.
