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By Rob Wile
June 6, 2017
Bloomberg—Bloomberg via Getty Images

Amazon has rolled out a new deal for Americans on government assistance: a discount of nearly half off Amazon Prime subscriptions.

“We designed this membership option for customers receiving government assistance to make our everyday selection and savings more accessible, including the many conveniences and entertainment benefits of Prime,” said Greg Greeley, Vice President of Amazon Prime, in a press release.

Instead of the usual prices of $10.99 per month or $99 per year, anyone with a valid Electronic Benefits Transfer (EBT) card will only have to pay $5.99 a month for Amazon Prime. All new subscribers can (and should) test out Prime service for free for 30 days during a trial period. Prime’s benefits include free two-day shipping on most Amazon orders, as well as unlimited free streaming of Amazon video and music content.

Amazon may not be making this move purely out of the goodness of its heart. By lowering the price point for Prime for certain consumers, Amazon could potentially expand Prime membership dramatically and steal sales from low-price competitors like Walmart. Reports have shown that shoppers tend to increase their spending significantly at Amazon once they sign up for Prime subscriptions. Thus far, Prime subscribers have been disproportionally wealthy as well.

The Wall Street Journal reports that low income shoppers are “a big opportunity” and are already buying online, but notes some lower-income consumers “still face hurdles because they more often lack typical bank resources like accounts or credit cards.” Nearly 44 million Americans now use food stamps.

EBT cards are given to people who qualify for government assistance programs like Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Women, Infants, and Children Nutrition Program (WIC).

You can’t actually use the EBT card to pay for the Prime membership; you just have to prove you have a valid one to get the discount. Customers can qualify every 12 months for the discounted Prime rate, and may get the discount for a maximum of four years.

Amazon says it will add other ways to qualify in the future for customers participating in government assistance programs that do not use EBT.

Meanwhile, House Republicans have had their sights set on an EBT overhaul that might kick some users off the program.

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The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

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