Forage's $40M Infusion: A Fintech Bet on Modernizing America's Food Aid

SAN FRANCISCO, CA – June 03, 2026 – Financial infrastructure platform Forage today announced a $40 million Series B funding round, a significant capital injection aimed at modernizing the nation's often-creaky system for distributing food aid. The round, led by Mouro Capital with participation from heavyweights like PayPal Ventures and Intuit Ventures, underscores a growing investor appetite for fintech solutions that address both market gaps and pressing social needs.

The new funding will fuel the expansion of Forage's core payments infrastructure and scale its new consumer-facing app, a tool designed to help low-income families manage their government benefits. This move positions Forage at the intersection of financial technology, retail, and social impact, tackling a problem that has become increasingly acute: the affordability of groceries. As CEO Ofek Lavian stated, "The cost of groceries is the number-one financial stressor in America." For the nearly 40 million Americans relying on the Supplemental Nutrition Assistance Program (SNAP), that stress is a daily reality, compounded by a benefits system built on decades-old technology.

Modernizing a Critical, Yet Outdated, System

The SNAP program, distributing nearly $100 billion annually, is a lifeline for one in eight Americans. Yet, the technology underpinning it, the Electronic Benefits Transfer (EBT) system, has struggled to keep pace with the digital era. This technological lag creates tangible friction for both beneficiaries and the retailers who serve them. For recipients, the system often lacks basic modern conveniences, such as reliable, secure ways to check card balances in real-time online.

This antiquated infrastructure has also proven vulnerable. A surge in card skimming and cyberattacks starting in 2023 exposed systemic weaknesses, resulting in millions of dollars in stolen benefits from the nation's most financially insecure households. In response, the USDA's Food and Nutrition Service (FNS) has mandated a transition from magnetic stripe EBT cards to more secure chip-enabled technology. While a necessary security upgrade, this shift places a significant technical and financial burden on retailers, who must update their point-of-sale (POS) systems to remain compliant.

It is within this complex environment of urgent need and technological debt that Forage has carved out its niche. The company has positioned itself as the essential digital plumber for the EBT ecosystem, earning the distinction of being the only USDA-approved third-party payment processor (TPP) focused on guiding retailers through this modernization. By providing the software and support for retailers to accept benefits like SNAP, WIC, and even health savings accounts (HSA/FSA), Forage is building the rails for a 21st-century benefits system.

Forage's Dual-Pronged Approach: Infrastructure and Consumer Empowerment

Forage's strategy is twofold. First, it provides the back-end infrastructure that allows retailers—from national giants to online platforms—to seamlessly and securely accept government benefits. Its technology is already in use at over 100,000 stores, including Dollar General, Save A Lot, and online delivery services like DoorDash and Uber Eats. This integration is crucial, especially as online grocery shopping becomes a staple for American consumers. Tony Rogers, Senior Vice President and Chief Marketing Officer at Dollar General, highlighted the importance of this partnership in extending the company's mission of "Serving Others," ensuring families "can enjoy the same accessibility and convenience, however they choose to shop."

The second, and more recent, prong of Forage's strategy is its direct-to-consumer app. Launched in late 2025, the free mobile application has already seen over 100,000 downloads, with an ambitious goal to reach one million families by the year's end. The app addresses the immediate pain points of SNAP recipients by providing a simple, secure way to check EBT balances. More than that, it aims to create a "network for affordability," as Lavian puts it. The app helps users discover savings, earn rewards on everyday purchases, find nearby SNAP-accepting retailers, and even learn which items are eligible for purchase with their benefits—a notoriously complex aspect of the program that varies by state. This direct consumer engagement transforms Forage from a mere payment processor into a comprehensive financial wellness tool for its target demographic.

Investor Confidence and the Retailer Advantage

The $40 million Series B round is a powerful vote of confidence in Forage's model. For investors like lead firm Mouro Capital, the company represents a compelling blend of market opportunity and social impact. "SNAP is one of the largest and most underserved payment ecosystems in the country," noted Christopher Gottschalk, General Partner at Mouro Capital. "Forage has built the only modern infrastructure to serve it at scale."

This investment thesis rests on several key pillars. The market size is undeniable, and the need for modernization is government-mandated, creating a clear demand for Forage's services. The company's unique USDA approval acts as a significant regulatory moat, creating a high barrier to entry for potential competitors. Furthermore, its explosive 13x growth in payments volume over the last year provides concrete evidence of market traction and a scalable business model.

For retailers, the value proposition is equally clear. Integrating Forage's technology opens the door to a massive and loyal customer base. By simplifying the technically and administratively burdensome process of accepting EBT, Forage allows retailers to better serve a significant market segment they might otherwise struggle to reach, particularly online. In an era of high food prices, catering to the "affordability needs of today's price-conscious shoppers," as Lavian notes, is not just a social good but a sound business strategy that drives growth and customer loyalty.

Navigating a Complex Regulatory and Economic Landscape

Despite its impressive momentum and clear mission, Forage operates in a landscape fraught with complexity. The regulatory environment for government benefits is in constant flux. Recent legislative changes, such as H.R. 1 (2025), have introduced stricter work requirements for SNAP recipients, which could potentially alter the size and composition of the beneficiary pool over time.

Furthermore, because SNAP is federally funded but state-administered, Forage must navigate a patchwork of rules and implementation details that vary across all 50 states. Upcoming policy shifts that increase the administrative cost burden on states could also reshape the dynamics of state-processor relationships, creating both challenges and opportunities for cost-effective solutions like Forage's.

The company's success will depend not only on its technological prowess but also on its ability to adeptly navigate this intricate web of federal and state regulations, maintain its trusted status with government agencies, and continue to prove its value to consumers and retailers alike. By tackling the dual challenges of food affordability and outdated financial infrastructure, Forage is making a bold play to become an indispensable part of America's social safety net.