Merchant category code

Whether you're a business owner accepting card payments or a developer building a financial application, understanding Merchant Category Codes (MCCs) is essential. These four-digit numbers classify businesses by the types of goods or services they provide—and they impact everything from interchange fees to rewards eligibility.

In this article, we’ll explain what MCCs are, how they’re used, and why they matter for merchants, banks, and consumers alike.

What Is a Merchant Category Code (MCC)?

A Merchant Category Code (MCC) is a four-digit number assigned to a business by credit card networks like Visa, Mastercard, American Express, and Discover. The code reflects the primary business activity of the merchant and is determined when the business starts accepting card payments.

For example:

• 5411 – Grocery Stores
• 5812 – Restaurants
• 7311 – Advertising Services
• 6012 – Financial Institutions

Who Assigns the MCC?

The MCC is typically assigned by the merchant’s acquiring bank or payment processor when the merchant account is set up. The bank selects the MCC based on the information provided about the business’s operations.

Why MCCs Matter

1. Interchange Fees

Different MCCs can have different interchange rates. For instance:

• Supermarkets may enjoy lower fees than travel or luxury retailers.
• B2B services may qualify for Level 2 or Level 3 data rates, which offer lower interchange fees if extra information is provided.

2. Card Rewards and Cashback

Credit card companies often offer category-based rewards:

• 3% back at gas stations
• 5x points on travel
• 2% on dining

These perks are triggered based on the MCC assigned to the merchant. If your MCC doesn’t match the expected category, the customer may not earn the reward they anticipated.

3. Purchase Restrictions

Some card issuers or corporate card programs use MCCs to restrict purchases. For example, employee cards may be blocked from making purchases under MCCs for liquor stores or gaming establishments.

4. Tax Reporting

Certain MCCs (like 6012 for financial institutions) are flagged for IRS reporting or special compliance requirements in the U.S., especially when dealing with cash advances or high-risk categories.

How to Find Your MCC

Merchants can find their MCC by:

• Reviewing their merchant agreement
• Checking a recent transaction receipt (sometimes printed in data)
• Contacting their payment processor or acquirer
• Using official MCC lists from card networks:
  • Visa MCC List
  • Mastercard MCC Guide

Can You Change Your MCC?

Yes, but it can be challenging. If your business has shifted its primary activity or was assigned the wrong MCC, you can request a reclassification through your acquiring bank or processor.

Tip: Choose your payment processor wisely—they play a key role in MCC assignment.

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Final Thoughts

Merchant Category Codes (MCCs) may seem like obscure numbers, but they play a vital role in card processing, fee structures, reward programs, and even tax reporting. For merchants, understanding your MCC can help reduce fees, ensure proper rewards for customers, and avoid compliance issues.

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