Fintech Platform Forage Raises $22 Million From Instacart Founder And Paypal
In America, 41.5 million people use food assistance programs and at least one player in the online grocery sector is looking to capture that market.
Forage, a San Francisco-based fintech platform, announced Monday that it raised $22 million from Instacart founder Apoorva Mehta, PayPal Ventures and fintech-focused Nyca Partners, which led the round, to make online grocery available for SNAP EBT- Receivers.
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Venture funding in the online grocery space doubled in size between 2020 and 2021, with startups receiving $8.6 million in 2021 per Crunchbase data. The rise of online grocery delivery was boosted during the pandemic, when people were confined to their homes and social distancing.
Update of grocery access
But for a long time, EBT recipients in California could only shop at a handful of online retailers like Aldi, Walmart and Amazon, despite the rise of online grocery shopping. Ironically, EBT recipients can greatly benefit from online grocery shopping—many have mobility-related disabilities, live in food deserts, or lack access to transportation.
During the COVID-19 pandemic, an additional 6.5 million individuals began receiving some form of food assistance, and food banks have only seen more scarcity due to rising inflation and the economic downturn.
In 2014, the USDA piloted an initiative that would allow those using food assistance programs like SNAP to get their groceries online, effectively making the pilot permanent in 2018 (although some states still don’t allow online grocery payments via EBT cards).
What Forage does
Før partners with grocery stores and e-commerce platforms to help them get USDA approval to accept EBT payments and offers an API that allows them to accept EBT cards, which work much like a debit card.
The company plans to use the new funding to accelerate hiring and to further develop the product.
“This capital will help accelerate Forage’s mission to democratize access to public benefits,” Ofek Lavian, co-founder and CEO of Forage, said in a statement. “We’re proud of the technology we’ve built and are excited to expand acceptance of SNAP EBT payments online for low-income Americans.”
Illustration: Dom Guzman
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