Uber Eats to accept food stamps in push to expand accessibility

By Natalie Lung | Bloomberg

Uber Technologies Inc. is planning to allow participants of federal nutrition and health care assistance programs to pay for food delivery with government benefits, joining rivals like Amazon.com Inc. and Instacart in making online shopping more accessible.

Starting next year, participants in the US Supplemental Nutrition Assistance Program will be able to order food and groceries from the Uber Eats App, the San Francisco-based company said on Wednesday. It’s also working with Managed Medicaid and Medicare Advantage plans to accept flexible spending account (FSA) cards, Flex cards and state waiver payments for food orders.

The product updates are part of Uber’s efforts to increase affordability and access to fresh and healthy food, said Therese Lim, senior director of the grocery and new verticals product at Uber Eats. “We know that food access is incredibly important, especially for under-served communities, food-insecure places or individuals who have disabilities or just even frankly, lack access to transportation that they can use to get to grocery stores.”

SNAP is the is the largest food assistance program in the US, with more than 40 million people receiving benefits in June, according to agency data. The Department of Agriculture has been expanding a program started in 2019 designed to make it easier for food-stamp recipients to shop online. Walmart Inc. and Amazon have been early leaders in the project, and Instacart expanded the number of stores where it accepts online payments from SNAP recipients in 2021.

Uber’s announcement comes on the heels of Instacart’s $660 million initial public offering on Tuesday under the official name of Maplebear Inc., demonstrating investor appetite in the online grocery business. Instacart is the biggest online grocery-delivery company in the US, reporting almost 263 million orders in 2022, but growth has slowed in the first half of this year as consumers return to in-person shopping.

Uber launched Uber Eats app in 2015 and added groceries three years ago, helping the company survive the pandemic when ride-hailing plummeted and demand for meals and groceries surged. The delivery unit now accounts for about half of the company’s total gross bookings.

Uber Eats has racked up about a $6 billion annual run rate in non-restaurant gross bookings on the app, which is available in 31 countries. Instacart, which operates primarily in North America, has an annual run rate of about $2.14 billion, based on the first-half revenue disclosed in its IPO prospectus.