A Detailed Guide to Merchant Category Codes!

 

Merchant Category Codes (MCCs) are four-digit codes used to classify businesses by the type of goods or services they provide. These codes are assigned by credit card networks and banks, and can be used to categorize spending habits for financial reporting and tax purposes. For example, a restaurant might have an MCC of 5814, while a clothing store might have an MCC of 5611.


MCCs are also used to determine the processing fees that merchants must pay when they accept credit cards. Businesses with higher risk transactions, such as those classified in the “entertainment” or “travel” categories, may incur higher processing fees than those in other categories.


MCCs can be divided into four main groups – Retail, Services, Travel, and Other/Miscellaneous. Here is a brief description of each group:


1. Retail Categories: These are for businesses that sell products directly to customers such as grocery stores, department stores, clothing stores, and electronic stores.


2. Services Categories: These are for businesses that provide services to customers such as medical offices, auto repair shops, beauty salons, and pest control companies.


3. Travel Categories: These are for businesses that provide travel-related services such as airlines, hotels, tour operators, and car rentals. 


4. Other/Miscellaneous Categories: These are for all other types of businesses that do not fit into the above categories such as banking, insurance, real estate, and non-profit organizations.


Knowing what MCCs are and which category your business falls under can help you understand how to best manage your credit card processing fees. If you need help determining the right MCC for your business, contact your credit card processor or bank for more information. With the knowledge of how MCCs work and which one applies to your business, you can save money on processing fees and maximize your profits.


We hope this guide has been helpful in understanding merchant category codes and how they are used to classify businesses. For more information, please contact your credit card processor or bank. With their help, you can make sure that you are using the right MCC for your business and save money on processing fees. 

Comments

Post a Comment

Popular posts from this blog

High Risk Merchant Account Services - Its Features

  High Risk Merchant Account Services - Its Features And Its Benefits As a business owner, you may have come across the term "high risk merchant account" but you may not be sure what it is or why you need one. A high risk merchant account is simply a type of merchant account that is considered to be higher risk than a standard account. There are a number of reasons why a merchant account may be considered high risk, but the most common reason is that the business is in an industry that is known for having a high rate of chargebacks or fraud. There are many benefits to having a high risk merchant account, even though it may come with a higher fee. The most obvious benefit is that it will allow you to accept credit cards, which can be a great way to increase sales. In addition, a high risk merchant account can provide you with access to more features and services than a standard account, which can help you run your business more efficiently. If you are thinking about opening a
Read more

Credit Card Processing Services Program - Its Features and Types

  Credit card processing services can be very beneficial for businesses of all sizes. By offering credit card processing, businesses can increase their customer base and sales. There are many different types of credit card processing services available, and each has its own set of features and benefits. One type of credit card processing service is merchant accounts . Merchant accounts allow businesses to accept credit cards as payment for goods and services. Merchant accounts come with a number of features, including the ability to set up recurring billing, track sales and customers, and provide customer support. Another type of credit card processing service is online credit card processors. Online processors allow businesses to process credit cards online. These processors typically have a higher processing fee than merchant accounts, but they offer a number of benefits, including the ability to process credit cards in real time, set up recurring billing, and track sales and cust
Read more

How Does a Cash Discount Merchant Services Program Work With Tips?

  A cash discount program is a type of merchant services program that allows businesses to offer customers a discount on their purchase if they pay with cash. This can be a great way to encourage customers to pay with cash, which can save the business money on credit card fees. To make sure the program works properly, businesses need to set up a few things in advance. Here are some tips on how to set up a cash discount program: 1. Decide what type of discount you will offer. The first step is to decide how much of a discount you will offer customers for paying with cash. This will depend on your business and what you can afford to give up in terms of margin. You should also consider what type of customers you want to encourage to pay with cash. For example, if you have a lot of regular customers who are always paying with credit cards, you may want to offer a larger discount to encourage them to switch to cash. 2. Set up a separate account for the cash discounts. You will need to set u
Read more