MAG Insights

When I wrote the first newsletter article on SNAP in January 2024, I could never have guessed we'd still be talking about EBT today, much less that the topics related to SNAP would have grown to such lengths. To help merchants keep up with the changes, we recently held a merchant meeting as a follow-up to our MAG Payments Conference 26 SNAP Special Interest Group (SIG).

EBT Chip Card Migration

The chip migration continues to move forward. Seven states have begun issuing chip cards, and several have completed their migration. Another five states are planning their rollouts.

States will issue cards using the latest X9.58 specification for SNAP cards. Some state-specific variations exist, such as whether cards support contactless transactions. However, all cards should work the same at the POS. Merchants can track each state's progress through the SNAP Modernization website.

The EBT Chip Card Implementation - Industry Guidance paper, published by the X.9 EBT Working Group earlier this year, is another useful resource for merchants preparing for the migration.

State Product Restrictions

As merchants upgrade their systems to accept chip cards, they are also navigating complex product restrictions. States can request waivers to restrict products eligible for SNAP benefits. More than twenty states have had their waivers approved, with many already in effect.

On June 22, 2026, the U.S. District Court for the District of Columbia issued an order in Aragon et al. v. Rollins et al., 1:26-cv-00861 (D.D.C.). The court vacated the Food and Nutrition Administration’s (FNA) approval of the waivers and prohibited its implementation in the five states covered by the litigation. This case is awaiting a decision by the appeals court. In the meantime, FNA continues to request public comments prior to approving any new state waivers.

Merchants can check the latest status of each state through FNA's SNAP Food Restriction Waivers. We will continue to follow the litigation and share updates as the case progresses.

SNAP Product Stocking Requirement Increase

As if the chip migration and product restrictions were not  enough, merchants also face increases to SNAP product stocking requirements. Earlier this year, USDA announced that merchants will need to increase the variety of products they stock, nearly doubling the previous requirement.

The Final Rule, published in May, introduces a tiered variety structure for product categorization. This approach differs from anything used in the past and went into effect on November 4, 2026. Retailer guidance was not published until November 6. Merchants should review the guidance and compare it against their implementation to ensure compliance.

SNAP Operating Standards

With all the changes in the SNAP program over the past several years, the USDA recognizes the need for FNA to respond more quickly when administering rules and guidance to stakeholders.

To address this, USDA published a Notice of Public Rulemaking (NPRM) requesting public comments on a proposal to attach an appendix to the SNAP Operating Standards that covers security requirements. These requirements could include mandatory chip issuance and acceptance.

Comments are due December 22, 2026. The MAG is currently reviewing the NPRM to determine if we will submit comments.

Key objectives of the Operating Standards include aligning SNAP closer to traditional consumer payment industry practices, allowing the ability to respond to future industry developments, and improving FNA oversight of new EBT implementation projects.

Merchants have an opportunity to shape these standards through the public comment process. We encourage members to review the proposal and share their perspectives.

Upcoming Merchant Meeting

We are hosting another merchant meeting on Thursday, December 3, 2026, at 10 a.m. CT. If you would like to attend and did not receive the invite for the November 5, 2026, meeting, contact Kelly Andrus directly for the calendar invite.