What is Merchant Category Code?

Approvals & UnderwritingAlso: MCC

Merchant Category Code

A four-digit code that classifies a business by the products or services it sells. Card networks and banks use the MCC to set risk expectations, interchange, and monitoring — which is why certain codes are treated as high-risk.

Your MCC influences how your transactions are priced and how closely they are watched. An accurate code that matches what you actually sell keeps your account aligned with the right risk program.

Being assigned a high-risk MCC is not a penalty; it just means your account belongs with a provider equipped to support that category.

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Related terms

Approvals & Underwriting

High-Risk Merchant Account

A merchant account for businesses that banks consider more likely to generate chargebacks, refunds, or regulatory scrutiny. It comes with stricter underwriting and often reserves, but it lets otherwise-hard-to-bank industries accept cards reliably.

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Approvals & Underwriting

Underwriting

The review process a provider uses to decide whether to approve a merchant and on what terms. Underwriters assess the business model, documentation, processing history, and risk exposure to set approval, pricing, limits, and any reserve requirements.

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Fees & Pricing

Interchange

The fee set by the card networks and paid to the customer's issuing bank on every transaction. Interchange is the largest, non-negotiable component of processing cost — everything a provider charges sits on top of it.

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