What Is an MCC? Everything You Need to Know About Merchant Category Codes in Credit Card Transactions

If you've ever wondered why some transactions earn cashback while others don't, or why payment processing fees differ across business types, then MCC is the key. Whether you're an online seller or a growing business, understanding MCC can help you cut costs, unlock bank rewards, and reduce unnecessary risks.

I. What is an MCC

MCC (Merchant Category Code) is a four-digit number used to classify transactions based on a business's industry. These codes are assigned by major credit card networks like Visa, Mastercard, and American Express, allowing banks, payment processors, and financial institutions to identify your business category.

1. Main purposes of MCC:

Classifying business spending: Banks and financial institutions use MCCs to determine what type of business you operate. This helps them design reward programs, cashback offers, and loyalty points tailored to different sectors.

Analyzing spending behavior: MCC data also helps banks track consumer spending trends by category, enabling more targeted promotions and discount strategies over time.

2. Some common MCC codes:

You can explore more MCC codes here.

II. Why Online Sellers Need to Understand MCC

1. Impact on Transaction Fees:

MCC plays a critical role in determining your payment processing fees. Banks use MCC codes to apply appropriate fee rates, and some industries may incur higher charges due to elevated risk or special processing requirements. For example, high-risk sectors like travel or financial services are often charged more, whereas categories like food or education may benefit from lower fees.

2. Avoiding Account Risks:

Payment providers also use MCCs to assess the risk level of your business. Industries with high refund or fraud rates, such as online trading platforms (MCC 6211), typically face higher fees and closer scrutiny. Some MCCs may even require specific licenses or are restricted by popular payment processors.

Choosing the wrong MCC can result in serious consequences, including transaction limits or even account suspension. For instance, if you sell digital products but your MCC is categorized under general retail, the system might flag your transactions as non-compliant.

3. Unlocking Rewards & Benefits:

Banks and card issuers use MCCs to determine whether a transaction qualifies for cashback, reward points, or other promotional programs. Selecting the correct MCC ensures that you can take full advantage of these perks, rather than missing out on cost-saving opportunities.

III. How to Check Your MCC

You can identify your MCC using several methods:

Contact your card-issuing bank: Most banks provide a list of MCCs and can assist you in checking your specific code directly.

Use online tools: Some websites allow you to input your business type to look up the corresponding MCC.

Examples include: Stripe, MCC IDENTITY, SwipeSum, etc.

Check your transaction receipts: In some cases, the MCC is displayed on the payment receipt or in transaction notifications from your bank.

IV. Conclusion

Understanding MCC not only helps you manage costs more effectively but also minimizes risks when selling online. If you're doing business on Amazon or any other platform, check your MCC now to ensure all your transactions go smoothly!

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