Maximizing Your Credit Card Rewards: Merchant Category Codes
If you have a reward credit card that offers extra earning opportunities at specific merchants, keep reading. In order to earn bonus points or cash back at specific merchants, the merchant must be properly classified; this is done through the Merchant Category Code, or MCC. The MCCs associated with the rewards on your credit card will typically be defined within your cards benefits/rewards/agreement. Better understanding how this works will help you earn more – what you’re expecting to earn.
What is an MCC?
An MCC is a four-digit number a business assigns when they begin accepting payments through a credit card network (Visa®, MasterCard®, Discover®, American Express®). These codes classify their business into specific segments of the market; however, not all businesses have the MCC you would expect. For example, your local gas station may be classified as a gas station, a convenience store, or even a grocery store. What does this mean? You may not earn as much in rewards as you’d expect. This is why it’s important to understand these codes to maximize the rewards you’ll receive.
How can I use MCCs to my benefit?
The key to maximizing category bonuses is to be familiar with the merchants’ MCCs you frequent. Some are straight forward, such as a local eatery being classified as a restaurant. But, a company or franchise may be classified differently from store to store. A Walmart near your house may be a Discount Store, while another miles down the road is considered a Grocery Store. So, if you earn more on grocery purchases, it may be in your best interest to visit the Walmart down the road to earn more rewards.
Do your homework.
Visa cardholders can utilize their Supplier Locator Tool to browse a directory of its partnered merchants and their MCCs. Simply input an address or zip code and search for businesses by name, industry, or MCC. If you are unable to find a merchant using this tool, try asking a manager or stopping by a customer service desk to ask how their store is classified. You can also monitor your transactions on your statements to determine how much you earned in rewards for certain purchases.
With a better understanding of the merchants you regularly do business with, you can tailor your spending to give you the best possible return in rewards. Are you earning the most from your rewards program?
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