merchant category codes

5 Things You Need To Know About Merchant Category Codes

You’ve come to the right site if you want to know what a merchant category code (MCC) is and the factors it signifies. Credit card processing might be difficult to grasp initially, but if you’re comfortable with the fundamentals, you’ll have no trouble following along. The more knowledge you have about MCC codes and their role in the wider payment processing system, the more informed business choices you will be able to make.

This article will discuss the 5 most important aspects of your MCC code and how they affect, removing the mystery around this merchant category code list.

What is an MCC (Merchant Category Code)?

Credit card processing companies use four-digit identifiers called merchant category codes to classify the types of purchases made with each card.

Codes used by retailers may signify several different things. Credit card companies are the ones that set the rules for rewards programs and decide whether a business transaction has to be reported. Codes also determine the percentage a business will pay the credit card processor for each transaction.

Certain credit card issuers don’t accept all MCCs, but most do. Issuers routinely update Codes that may introduce new ones or remove older ones.

Merchant Category Codes: Why do they matter?

The significance of merchant category codes has grown along with the variety of applications for them. Knowing how your business falls into the various categories that credit card processors assign based on your MCC code might be useful when comparing prices.

It’s important to be aware that many merchant services providers use MCC codes to categorize and label the “prohibited sectors” from which they would not accept business. If your business falls into one of these high-risk categories, you may want to research companies that focus on providing payment processing services to similar businesses.

The MCC codes might also affect the processing fees. If a business is incorrectly classified, it may incur larger processing expenses. Each Visa transaction is granted a unique Visa merchant category code. Merchants should ensure they have been allocated the correct code.

merchant account services

Making the appropriate MCC selection

The success of the transaction may be enhanced by selecting the appropriate MCC. Your MCC code may impact payment processing in a few ways because it indicates the “predominant business activity of the merchant.” These methods include:

Bonuses and rewards:  The MCC of the merchant where the transaction was completed is used to calculate any bonus points or awards that may have been earned using the credit card. Bonuses are automatically accrued, and most credit card companies give listings of participating stores. Again, an accurate MCC listing is crucial for retailers to ensure their customers are eligible for certain loyalty program bonuses.

Identify high-risk industries:  Before agreeing to provide services to a merchant, an acquirer will utilize the MCC code to determine whether or not the merchant is engaged in a high-risk industry.

Ability to charge convenience fees:  Not all businesses have the legal right to impose an additional fee for using credit cards. Some MCCs tack on a convenience fee whenever a credit card is used to make a purchase, as opposed to “preferred” payment methods such as cash.

Interchange rates:  Card companies and processors like Visa and MasterCard depend on MCCs to establish the interchange rate. In the case of credit card transactions, the stated rate is the wholesale price paid by both consumers and businesses. Since rates vary significantly amongst different manufacturers, the MCC ultimately sets the going rate. Due to the increased frequency of chargebacks in high-risk companies, their per-transaction exchange costs will be higher.

Merchant Category Code Lookup

Various credit card companies have a separate list of merchant category codes. If a business needs assistance locating its MCC, it should contact its credit card processor (such as Visa or Mastercard).

There is a list of credit card merchant category codes available on the websites of all major credit card processors. The list can be retrieved by searching for the processor’s name and “merchant category codes.” Alternatively, you may contact the credit card company using the number printed on the back of your card.

You may use Visa’s Merchant Locator Tool to find MCCs. This makes it possible to research MCCs from any store. Type in the business’s name, or use your location to narrow your search. The MCC search feature is another useful addition to this application.

Those who use credit cards may also check their monthly bank statement to discover what category a certain transaction falls into. There has to be a “merchant description” column for each transaction that details the kind of merchant being used. Rather than a four-digit number, it may just be the name of the corresponding category. The Quick Reference Booklet – Merchant Edition for Mastercard is a resource that can be accessed online for Mastercard merchant category code lookup.


How Merchant Category Codes work?

Credit card issuers will give you a merchant category code. The code is used to figure out things like your business’s share of interchange fees, the availability of certain features, and, in the case of restricted cards, whether or not they may be used to make transactions there.

Your credit card issuer will utilize the merchant category code (MCC) of the retailer you purchased to determine whether or not you are eligible for bonus benefits.
Suppose you’re at a candy shop, which the Internal Revenue Service categorizes as MCC 5441 (“candy, nut, and confectionery establishments”). If you use a credit card that gives bonus points for purchases made in that category, the issuer will credit your account with the appropriate MCC when you make a purchase there.

When should the MCC be updated?

The vast majority of companies generally won’t run into significant problems with their MCC Codes. However, there are instances in which it may be beneficial to alter the code with the payment services company you use. You may wish to press the issue in situations like:

Your company has changed

Perhaps you’ve diversified your product line, introduced a new service, or altered your advertising strategy. It’s conceivable that the MCC code you’ve been using no longer matches the way you do business.

Your rejected transactions are unusual

Whether you’ve seen an unusually high number of refused transactions that your customers can’t account for, you may want to check the Merchant Category Code list 2022 to verify if your MCC code is correct.


Whether you’re a customer looking to maximize rewards or a company owner accepting credit cards, there are several scenarios in which the MCC issued to a business makes a difference. However, because each credit card network may allocate a unique MCC, locating a company’s MCC isn’t always a simple task.

The simplest approach to discovering a company’s MCC as a customer is to make a minor transaction and examine the next credit card statement. Although this approach is less than ideal, at least the MCC of a company will be known with certainty.