MCC is a four-digit number used by businesses to identify the type of goods or services sold. The code is used by credit card processors to help them determine the interchange rate (the amount the credit card company charges for each transaction) that should be applied to a particular sale.
Credit card processors use merchant category codes (MCC) to identify the type of product or service a business sells. This helps them determine which interchange rate to apply to a particular sale.
What Is MCC and What Does It Stand For?
MCC stands for “Merchant Category Code”. It is a four-digit code that classifies businesses into different categories based on the type of products or services they offer.
The codes are also used by banks and other lenders to help them decide what type of loan to offer a business. For example, a bank may offer a lower interest rate to a business that sells products in the “food and beverage” category than it would offer to a business that sells office supplies.
There are more than 5,000 different MCCs, and they are classified into 28 different categories. The most common categories are:
• Retail: This category includes businesses that sell products to consumers, such as clothing stores, grocery stores, and car dealerships.
• Service: This category includes businesses that provide services, such as hair salons, auto repair shops, and accountants.
• Hospitality: This category includes businesses that provide food and drinks, such as restaurants, bars, and catering services.
• Professional: This category includes businesses that offer professional services, such as lawyers, doctors, and architects.
MCCs are assigned by credit card processors. They generally use the classification system developed by the National Retail Federation (NRF), but they can also create their own codes for specific types of businesses.
MCCs are not the only factor that credit card processors use to determine interchange rates. They also look at the type of credit card being used, the amount of the sale, and the location of the business.
But MCCs are one of the most important factors, and businesses that want to get the lowest interchange rates should make sure their codes are correct.
Why Is MCC Important for Businesses?
MCCs are important for businesses because they help classify the company into a certain category. This classification then determines what type of credit card processing services the company is eligible for. For example, a company that sells clothing would have a different MCC than one that sells computers.
What Does MCC Do for Credit Card Companies?
MCC helps credit card companies to identify fraudulent activity. When a purchase is made, the credit card company will check the MCC of the business to make sure it matches the type of product or service that was purchased. If there is a discrepancy, it may be an indication that the purchase was made fraudulently.
How Is MCC Used in Credit Card Processing?
No, not all businesses need an MCC. It is used by credit card companies to help identify fraudulent activity. When a purchase is made, the credit card company will check the MCC of the business to make sure it matches the type of product or service that was purchased. If there is a discrepancy, it may be an indication that the purchase was made fraudulently.
MCCs are used in credit card processing to help classify businesses into different categories. This information is then used by credit card companies to help identify fraudulent activity. For example, if a company sells clothing, its MCC would be different from one that sells computers. Credit card companies use this information to determine what type of services the business is eligible for.
What Are the Benefits of Understanding MCC?
Businesses that understand MCC can benefit in a few ways.
- First, they can make sure their MCC is accurate and up-to-date. This will ensure that they receive the correct processing services for their business type.
- Second, understanding MCC can help businesses stay ahead of fraudsters. By knowing how to spot fraudulent activity, businesses can protect themselves from losing money.
- Lastly, understanding MCC can help businesses better understand their customers. By knowing what types of products or services their customers are interested in, businesses can tailor their marketing strategies accordingly.
Most Common MCC Codes Used in Credit Card Processing Transactions?
The most common MCC codes used in credit card processing transactions are:
- 5411 – Restaurants and Bars.
- 5521 – Grocery Stores and Supermarkets.
- 5812 – Drug Stores and Pharmacies.
- 5943 – Amusement Parks and Arcades.
- 6011 – Online Retailers.
- 6411 – Airline Tickets and Travel Agencies.
- 7222 – Men’s and Boy’s Clothing Stores.
- 7832 – Computer Systems Design Services.
- 8051 – Sewing, Needlework, and Piece Goods Stores.
- 8299 – All Other Miscellaneous Retail Stores.
- 9111 – Executive and Management Consulting Services.
- 9211 – Architectural Services.
- 9411 – Engineering Services.
- 9511 – Advertising Agencies.
- 9699 – All Other Professional, Scientific, and Technical Services.
If you don’t know your business’s MCC code, you can find it by contacting your credit card company. They will be able to provide you with the correct information. Alternatively, you can search for a list of MCC codes online. There are many websites that offer this information for free.
If your business’s MCC code changes, you will need to update your credit card processing account information accordingly. You can do this by contacting your credit card company or by updating the information on your merchant processing account. It is important to keep your account information up-to-date so that you continue to receive the correct services for your business.
Understanding what Merchant Category Codes are and how they work can help you stay ahead of fraudsters, understand your customers better, and ensure that you’re receiving the correct processing services for your business. If your MCC changes or if you would like to learn more about them in general, be sure to contact your credit card processing company. They will be happy to help!
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