Merchant category code

{{Short description|Four-digit number listed for retail financial services}} A '''merchant category code''' ('''MCC''') is a four-digit number used for retail financial services to classify a business by the types of goods or services it provides. Codes are specified by the ISO 18245 standard.

==Assignment of codes== MCCs are assigned either by merchant type (e.g., one for hotels, one for office supply stores, etc.) or by merchant name (e.g., 3000 for United Airlines<ref>{{cite web|website=www.citibank.com|publisher=Citibank|title=Merchant Category Codes|url=https://www.citibank.com/tts/solutions/commercial-cards/assets/docs/govt/Merchant-Category-Codes.pdf}}</ref>) and is assigned to a merchant by a credit card company when the business first starts accepting that card as a form of payment.<ref>{{cite web|publisher=VISA |location=USA |url=http://usa.visa.com/download/corporate/resources/mcc_booklet.pdf |title=Merchant Category Codes |website=usa.visa.com |url-status=dead |archiveurl=https://web.archive.org/web/20070710202209/http://usa.visa.com/download/corporate/resources/mcc_booklet.pdf |archivedate=July 10, 2007 }}</ref> The same business may code differently with different credit cards, and different sections or departments of a store may code differently.<ref>{{cite news|work=NerdWallet |title=Merchant Category Codes: Why They Matter for Credit Card Rewards|author1=Frankel, Robin Saks |author2=El Issa, Erin |date=August 1, 2019}}</ref>

==Uses of codes== An MCC reflects the primary category in which a merchant does business and may be used: * to determine the interchange fee paid by the merchant, with riskier lines of business paying higher fees * by credit card companies to offer cash back rewards or reward points for spending in specific categories<ref>{{cite web|accessdate=December 16, 2015|url=https://creditcards.chase.com/aarp/cardmember/terms_restaurant_gas|website=Chase Bank|title=Welcome to AARP® Credit Card from Chase. Earn 3% Cash Back rewards on restaurant and gas station purchases (Terms)|archive-url=https://web.archive.org/web/20190207015841/https://creditcards.chase.com/aarp/cardmember/terms_restaurant_gas|archive-date=February 7, 2019|url-status=dead}}</ref><ref>{{cite web|accessdate=December 16, 2015|url=https://www.discovercard.com/application/displayLanding?pageFileId=paidsearch-rewards-v2&sc=KE2F&iq_id=r43700008012353043&cmpgnid=ps-dca-yahbing-sl-cashrewards|website=Discover IT|title=Credit card rewards that really add up}}</ref> * by card networks to define rules and restrictions for card transactions (for example, Automated Fuel Dispensers (MCC 5542) have specific rules for authorization and clearing messages{{citation needed|date=September 2019}}) * for tax purposes, e.g., in the United States, to determine whether a payment is primarily for “services”, which needs to be reported by the payor to the Internal Revenue Service for tax purposes, or for “merchandise”, which does not<ref>{{cite web|publisher=Internal Revenue Service|location=USA|url=https://www.irs.gov/irb/2004-31_IRB/ar17.html|website=IRS.gov|title= Internal Revenue Bulletin: 2004-31, Rev. Proc. 2004-43, Merchant Category Codes to Determine Reportable Payment Card Transactions |date= August 2, 2004 }}</ref>

==Code lookup tools== There are multiple resources credit card users can consult to predict how credit card purchases with given vendors may be categorized. Examples include: *{{cite web|url=https://usa.visa.com/content/dam/VCOM/download/merchants/visa-merchant-data-standards-manual.pdf|title=Visa Merchant Data Standards Manual}} *{{cite web|url=https://github.com/greggles/mcc-codes |title=List of MCC codes in CSV, ODS, XLS formats |website=github|date=24 August 2022 }} *{{cite web|url=https://github.com/jleclanche/python-iso18245 |title=An ISO 18245 python library for MCCs |website=github|date=6 July 2022 }}

==References== {{reflist}}

Category:Credit card terminology Category:Classification systems {{business-term-stub}}