The Trump administration announced a new federal rule requiring all 50 states to upgrade their food stamp payment cards with chip technology and tap-to-pay capabilities within two years. The U.S. Department of Agriculture's Food and Nutrition Administration issued the proposed rule on Friday.

The rule addresses widespread theft of Supplemental Nutrition Assistance Program benefits. ProPublica reported last week that $470 million in SNAP benefits were stolen from recipients in the prior year, largely because Electronic Benefits Transfer cards use outdated magnetic stripe technology that criminals can easily skim. The new rule will mandate transition from magnetic stripe cards to chip cards, which credit and debit card companies have used for over a decade.

The proposal was in development since 2023 but faced repeated delays due to understaffing at USDA and other regulatory backlogs. Two USDA officials indicated ProPublica's reporting circulated within the department.

California already transitioned to chip cards and saw theft of SNAP and other public benefits reduced by 83% over two years. More than 40 states have not yet adopted the technology.

The public, including state SNAP administrators and grocery store owners, has 60 days to submit comments before the rule takes effect. The estimated cost of the transition is $283 million compared to over $600 million in annual theft from existing cards.

Multiple current and former USDA Food and Nutrition Administration officials and state program administrators expressed concern to ProPublica that the mandate requires expensive changes without clear federal funding commitments. The Senate version of the Farm Bill includes funding for the transition, but the House version does not.

Justin King, policy director for Propel, called the national mandate "a big deal for low-income households," stating that a uniform standard prevents criminals from simply moving to states without chip cards.

Vice President JD Vance, serving as the administration's "fraud czar," held a press conference in Ohio emphasizing that low-income families are victims of SNAP fraud. Vance previously portrayed SNAP recipients as perpetrators of fraud. Attorney General Todd Blanche provided details on recent SNAP theft prosecutions, including Oregon cases in which criminal groups allegedly stole account numbers and PINs to purchase bulk goods resold for over $3 million.