What is a Merchant Category Code (MCC)?

mer - chant cat - e - gor - y code
A 4-digit code designated by a Credit Card company that lists the product, service, or line of business of a merchant.
How Does a Merchant Category Code Work?

A merchant category code is first assigned by a Credit Card company, such as Visa or MasterCard, to a Merchant once it begins to accept one those companies' credit cards. If a merchant is involved in more than one type of business, than the Merchant Category Code will apply to that merchant's primary line of business.

For more information, read "The Payments System Simplified"
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