Why Is MCC Code Important For Businesses?


When you start a business, you must open an online merchant account. The online merchant services will help you to open this account. Once you have this account you can get lots of payment options. The customers will be satisfied once they get more than one option to pay. Debit or credit card processing is considered to be safe as there is a CVV number that protects that card from any fraudulent activity. Without the CVV number, your transaction won’t be processed. Online merchant services will provide an MCC code for your account. This MCC code is very important for processing transactions. 

Identify the type of business

This code will recognize the type of business; whether it’s a high-risk or low-risk business, what kinds of products you sell, and more. If It’s a high-risk business then the merchant services process the transaction very carefully because this type of business has higher chances of getting chargebacks. 

Determine interchange rate

The card brands use this code to find out the interchange rate. For high-risk businesses, the charge is higher than that of low-risk businesses. This is due to the higher chargeback rate of high-risk businesses. 

Chargeback protection

Using the code it is possible to determine the level of chargeback protection. Betting, direct marketing, and other businesses don’t have the same fraud protection for online transactions as other low-risk businesses. Also, the rate of the chargeback is high for these businesses. 

Reward calculations

The MCC code will determine the type of business and the reward that will be assigned according to your business. For example, when you buy something from a restaurant you may get a reward attached to a convenience store instead of a restaurant. This happens because the restaurant owner might also have a convenience store and most of his revenue is generated from the convenience store. So, the merchant services consider the convenience store to be his primary business. 

If you can get the right MCC code for your business then you can lower the processing costs. If you are a nonprofit or educational organization, for example, you will enjoy a lower processing cost. Some codes may prevent customers from using certain cards. The code can tell you what kinds of cards you can use to make transactions. 

You should seek an experienced merchant service to help you operate your business. They will tell you everything you need to know about payments and other merchant services.


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