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From Paper To Plastic By 2002: Retailers' Perspective On Electronic Benefit Transfer Systems For Food Stamps

Author

Listed:
  • Quinones, Ana R.
  • Kinsey, Jean D.

Abstract

The Food Stamp Program (FSP) is working under the deadline of October 1, 2002, to coordinate a change from the current paper disbursement system of paper food stamps to an electronic transfer system of benefits, known as EBT. The Food and Nutrition Service of the U.S. Department of Agriculture has been studying the effectiveness of differing vehicles for benefit dispersal since the inception of the FSP in the 1960's. The merits of a direct cash payment have been compared to those of the paper system by the USDA and an array of professional groups and research organizations. The adoption of the electronic benefit transfer (EBT) system engenders a new set of questions about the effects of EBT on benefit recipients, retailers and the administering government agencies. Issues surrounding the transition from paper to plastic are still problematic for retailers in spite of the rapidly approaching deadline. National interoperability of EBT as well as fees involved with EBT operation are still points of contention for retailers. Anecdotal evidence from retailers also point to kinks in the institutional operation of EBT. Peak-loading problems with the electronic network system generate a host of undesirable consequences for benefit recipients and retailers. These problems impede the electronic system from taking advantage of the positive network effects that could arise from this new technology.

Suggested Citation

  • Quinones, Ana R. & Kinsey, Jean D., 2000. "From Paper To Plastic By 2002: Retailers' Perspective On Electronic Benefit Transfer Systems For Food Stamps," Working Papers 14338, University of Minnesota, The Food Industry Center.
    • Handle: RePEc:ags:umrfwp:14338
    DOI: 10.22004/ag.econ.14338
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