What are MCC Codes and How Do They Impact Merchant Services?

Merchant Services MCC Codes

Your clients depend on you to ensure that they receive the best merchant services possible and the best transaction rates you can possibly provide them. Merchant category codes, or MCC codes, play a big part in your ability to do both, so it’s important to understand what MCC codes are, how they’re set, how they impact your merchants, and how you can ensure they’re accurately assigned. In this article, we’ll look at the basics of merchant category codes and how IRIS CRM enables you to quickly and easily set them for each of your new merchants.


What Are MCC Codes?

Merchant category codes are four-digit codes assigned based on ISO 18245, the standard for classifying retail financial services. Most MCCs are assigned to merchants to classify them based on the type of business they primarily conduct. For instance, MCC 7538 is the Visa code for auto service shops. In certain instances, large companies receive their own MCC codes separate from their industries as a whole. British Airways, for instance, carries Visa code 3005, while Marriot Hotels are coded 3509. Each major credit card company maintains its own set of codes, and while some may overlap, it is common for businesses to carry different codes for different card types.


What Are MCC Codes Used For?

Merchant category codes are used to differentiate businesses so that transactions can be properly categorized. There are a number of factors dependent on MCC codes, not the least of which is the interchange fees exchanged between the merchant bank and customer bank to cover the costs of transaction processing. MCC codes also determine eligibility for cashback and reward point rates and impact how payments are reported for tax purposes. Merchants are assigned MCC codes by their banks or merchant services providers upon the establishment of their accounts, and since the codes play a major part in everything from transaction fees to taxation, it’s incredibly important that merchant services providers use a reliable lookup tool and set the right codes.


Setting MCC Codes in IRIS CRM

IRIS CRM’s TurboApp merchant boarding tool now enables ISOs and agents to set card-specific MCC codes for new merchants being boarded to certain payment processors. For instance, thanks to TSYS’ Express Boarding SDK update, TSYS TurboApp submissions now include a “card brand MCC participation” option enabling individual MCC fields for Visa, Mastercard, Discover, and AmEx as opposed to the standard Visa and Mastercard options shown when the option is disabled. Now, your team can assure new merchants that they’ll be assigned accurate MCC codes for all four major companies, ensuring the correct interchange fees and the best possible fees with payment processors utilizing interchange-plus pricing.


Flexible MCC assignment is just one of the many benefits offered by TurboApp and IRIS CRM. For more information on IRIS CRM’s full suite of productivity-boosting features and how TurboApp streamlines and speeds up the merchant boarding process, visit IRISCRM.com and book a demo or talk to one of our expert support agents today

Schedule Demo