What is a SaaS Merchant Category Code (MCC)?

When a merchant account is established, a Merchant Category Code (MCC) is a four-digit classification assigned to a business by its acquiring bank or payment processor. It categorizes a business by the types of products or services it offers, according to the ISO 18245. 

For a SaaS company, the MCC informs card networks like Visa and Mastercard of the type of software business you operate. The presence of an appropriate MCC for a subscription software company can influence aspects such as transaction approval efficiency, applicable fee structures, and the frequency of payment disputes.

Since there is no single universal code for every software business, the correct one depends on what you really sell.

• MCC 5734 (Computer Software Stores): This is intended for merchants mainly focused on retail sale of computer software, including off-the-shelf programs, operating systems, and business software like accounting or CRM applications. Many subscription-based SaaS enterprises are under this category.
• MCC 7372 (Computer Programming, Data Processing, and Integrated Systems Design): This code is for merchants supplying data processing and related consulting services, which would cover SaaS companies that focus on development, data services, or have a significant professional services component.
• MCC 5817 (Software Applications, Excluding Games): Typically for app-based or digitally delivered software models.
• MCC 5045 (Computers, Peripherals, and Software): More appropriate for companies that deal in hardware distribution along with software.
• MCC 7311 or other niche codes: But if your SaaS offering is combined with advertising, marketing, or other services, then these codes may come into play.

Interchange fees are not the same for all; card networks select different rates based on risk level, and software/digital goods categories may have different pricing structures than general retail ones. Besides this, your MCC also defines your risk profile, impacts the fraud monitoring of your transactions, and the interpretation of your dispute ratios. A difference between a SaaS company’s assigned risk classification for an entity and its actual risk profile can be linked with varying applicable fees or chargeback thresholds.

Begin with your main source of income: subscription software licensing, custom development, or a combination. Either contact your payment processor directly, check official payment network classification lists, or use an MCC lookup tool to get your current code. Align your business description with the official definitions of codes such as 5734 and 7372, and remember that the difference between a “software product” and a “software service” can be the deciding ​‍​‌‍​‍‌​‍​‌‍​‍‌factor.

If there is a perceived discrepancy with your MCC, contacting your banca acquirente or payment processor support is the established procedure, as merchants are not allowed to modify this information. 

You should be prepared to clearly describe your main business activity and “back it up” with supporting documentation like your website, product descriptions, or sample invoices. 

il processore di pagamento will check your request and adjust the code if the evidence shows a different classification. A manual review by the processor is generally involved in this process segment, contributing to its potential time frame.

Revisit your MCC whenever your core business model changes significantly, such as when you launch new product lines, change from self-serve software to custom implementation services, or add hardware to your offering. The initial codebase of a company that formed as pure software in abbonamento and included consulting-heavy custom integrations could be considered in the context of its business requirements.