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Things You Need To Know About Merchant Category Code


Merchant category code is very important for any business. This code tells in which category your business falls, what goods and services you provide. The classification is set by the International organization for Standardization (ISO) and the code is assigned by the credit card processors.

Things You Need To Know About Merchant Category Code

Various merchant category codes

There are hundreds of merchant category codes depending on the goods and services provided by the business. The codes consist of four digits and these codes represent businesses like grocery stores, fast food restaurants, book stores, drug stores, and more. You need to get your merchant category code or MCC from the ISO and for that, your business should have a minimum of $10 million in revenue a year. So, only big businesses like renowned hotels or restaurants have an MCC code; small businesses don’t.

How to find the MCC of a business

If you want to find the MCC of any business you can look into the website of VISA or MasterCard. You can search for a business according to the name or address.

Why MCC is important?

MCC offers lots of benefits to both the business and the consumer. The credit card processing rate is determined by the MCC, for example. The banks set the fees depending on the category of business. If the business is of high risk then the fee will be more. For example, if you are in the airline business, there is a risk of accidents, so your fee will be higher compared to a restaurant business. The merchant category code recognizes your business. So, in case a customer forgets about a certain bill he or she paid at your restaurant then their bank statement will show the merchant category code of your business and it proves that the bill was paid and that it wasn’t a fraudulent activity.

The merchant category code is also used by credit card companies when providing cashback to consumers. The percentage of cashback is based on the category of business. So, if you buy things from a grocery store, your cashback percentage will be different than if you dined at an expensive restaurant.

So, you can see that an MCC is very important for a business as it serves several important functions. If your business revenue crosses $10 million annually, then you should consider applying for a merchant category code.

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Shirley is a passionate blogger. She writes about her life experiences in the form of words. She had done masters in technology & working with a leading technology organization as an analyst. Moreover, if you want to follow her, then subscribe to the feeds.


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