Because the MCC code is the merchant's category code, it is critical for the checks performed during merchant onboarding and authorization.
The MCC code is used in the following cases:
- Campaign definition and management (for example, in a campaign like "make 4 transactions of 100 TL at Fuel and Grocery merchants and earn 40 TL in points," the Fuel and Grocery sectors are distinguished by their MCC codes).
- Blocking a card from transacting at certain types of merchants (for example, casinos); this control is also carried out based on the MCC.
- The MCC code is also used in checks on merchant onboarding applications (for example, if we don't want to issue POS terminals to casinos, a warning can be triggered when an application is submitted for a merchant defined under the Casino MCC).
How is an MCC determined?
An MCC (Merchant Category Code) is a 4-digit code that indicates a merchant's line of business. The codes are defined under the ISO 18245 standard, and card schemes publish lists based on it. The acquiring bank assigns the appropriate MCC based on the business activity the merchant declares during onboarding and its own review.
Common MCC examples
- 5411: Grocery stores and supermarkets
- 5541: Service (fuel) stations
- 5812: Restaurants
- 4111: Public transportation
- 6011: Cash withdrawal at ATMs
Consequences of assigning the wrong MCC
Assigning a merchant an MCC that doesn't match its actual business can allow sector-specific rules to be bypassed. For example, if a merchant in a sector where installments aren't allowed is defined under a different MCC, installment transactions could be processed in violation of legal limits. Card schemes treat deliberately misassigning an MCC as a serious violation and can impose sanctions on the acquiring bank.
Reporting and analysis
MCC lets banks and card schemes report spending statistics by sector. How much card spending occurs in each sector is analyzed using these codes.