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Education
New MCC for gun and corresponding SIC code. Card issuers may use MCCs to
categorize, track and restrict transactions. An issuer could
ammunition sellers segregate customers most apt to respond to a restaurant
ad, for example.
Issuers may further use an MCC to adjudicate an
authorization. Transaction size and time of day should
triangulate with the MCC. MCCs may also be used for tax
reporting and interchange qualification.
The MCC defined
An MCC is a four-digit code. Each merchant is assigned
By Ken Musante one according to their vertical. There is some art to
Napa Payments and Consulting the assignment, but the MCC should correspond to a
merchant's primary business. This could be confusing,
isa and Mastercard use merchant category however, as a business could sell Christmas trees in
codes (MCCs) to classify merchant verti- December and fireworks in July. Further, a store may
cals such as bars, restaurants and churches. sell both sporting goods and serve as a taxidermy. A
V MCCs are derived from Standard Industrial grocery store may have a florist or deli within it, and those
Classification (SIC) codes and from International respective registers would be assigned different MCCs
Organization for Standardization (ISO) codes. This month than the grocery's MCC.
the ISO approved a new merchant code for gun sellers.
Visa, Mastercard and American Express indicated they With this backdrop, we can better understand the context
would follow suit. for the newly defined MCC for gun and ammunition
Card network MCCs and definitions do not always sellers. Visa and Mastercard do not track purchases
correspond to SIC codes. Some MCCs are consolidated, by cardholders. They do not have an agreement with
while others within the travel and entertainment the cardholder and could not provide a means for the
sector are specific to the merchant and do not have a cardholder to set their privacy preference.
Issuers, however, can track purchases
by MCC. Issuers do not have access to
transaction level data, only the amount
purchased at each store. Ostensibly,
this could and should allow issuers
to notify the ATF if they are aware of
unusual purchasing behavior by a
single customer.
New urgency for updating
Miscellaneous or catch-all MCCs
typically end with 99 and may be used
if a more accurate MCC does not exist.
Currently, for example, MCC 5999
is designated for miscellaneous and
specialty retail shops. Firearms and
ammunition stores would be classified
here along with ice dealers, beauty
supply stores and magic shops.
Certain business types must be
assigned multiple MCCs, if there
are distinct areas of the location for
differing business types and each has
its own POS. The card networks could
at some point mandate any merchant
selling guns have a separate MCC
specifically as a precondition. Note, I
am postulating what they could do,
not what they have done. The MCC
selection is not automated. It is chosen
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