Merchant category codes (MCC Codes) are assigned to merchant accounts and are used to differentiate between types of business & industries. Each industry has different transaction patterns and differing levels of risk and exposure to fraud. MCC codes are used during the underwriting process by an Acquirer or Payment Facilitator and during the transaction process such as 3-D Secure v2.

MCC codes can also effect the merchants processing rates. An improper classification could cause a merchant to pay higher than necessary processing fees. The are approximately 500 different MCC Codes used and it is important for a merchant to make sure they are assigned to the appropriate code.