A merchant category code, or MCC, is a four-digit number that classifies a business by the type of goods or services it provides. Visa's Merchant Data Standards Manual describes the MCC as a number assigned to describe a merchant's primary business. Stripe gives grocery stores (5411) and bus lines (4131) as examples.
Because the code is used when payments are authorized and when risk is assessed, it is one of the basic facts the payment system holds about a business.
What an MCC is used for
Visa's manual says Visa and its members use MCC data for purposes including activity tracking, reporting and risk management. Stripe's documentation says MCCs are often used for calculating interchange fees, authorizing payments and preventing fraud.
Because the code feeds into these decisions, it needs to describe the business as it actually is.
Who assigns the code
Visa's manual says it is an important requirement that acquirers (the banks that contract with merchants to accept cards) and their agents assign the correct MCC to each merchant. Visa retains the right to require corrections.
On Stripe, each account has exactly one MCC. Stripe's documentation for connected accounts says it generally sets the code from the industry listed for the account, and may use information from the account's website if the industry is not enough. If a Stripe review finds an MCC is inaccurate, Stripe may update it.
How the right code is chosen
Visa's manual sets general rules for assigning MCCs. Among them:
- Select the MCC that most accurately describes the merchant's business, which in most cases reflects its primary type of business.
- A merchant with more than one line of business is assigned the MCC for the line with the highest sales volume, or, where the acquirer agrees, a separate MCC for each line. Each code still has to describe that line accurately, and the acquirer decides.
- Use "miscellaneous" codes only when no MCC specific to the business applies.
Why accuracy matters
An MCC is part of how a business describes itself to the payment system. Choosing a code because it looks better than the true one is miscoding, and it runs against Visa's rule that the code should most accurately describe the business. The honest approach is simple: describe what you sell accurately when you set up your account, and keep that description current as your business changes. If a processor decides it cannot support your business as described, that is its decision to make.
For a research supply business, the same principle applies to everything a reviewer sees: your storefront, your policies and your answers to questions. See how payment processors review a merchant and card network rules merchants should know.
Where this fits
Claddr connects to your own Stripe account. It does not set or change your MCC, and it does not influence how Stripe or the card networks classify your business. Read more about how Claddr works.