MCC/SIC & Industry Analysis Topics

Question 0

What are Industry codes?

Answer 0

Industry Codes are codes that have been created by the Fed. Gov. and applied to businesses based on what products and/or services they sell.

Question 1

What do MC and Visa call these industry codes?

Answer 1

MCC - Merchant Category Codes

*NOTE - When a merchant closes a batch it must be identified with a MCC

Question 2

Risk Analysts use Standard Industry Codes (Internally used) for what?

Answer 2

For risk management classification SIC are used to evaluate LOW, MODERATE, HIGH & EXTREMELY HIGH

Question 3

Who assigns the MCC?

Answer 3

The Sales Force is responsible for assigning the MCC.

Question 4

Remember: The correlation of MCC to SIC when making changes

Answer 4

If the level is HIGH and if they change their method of payment to the SAME RISK level then the risk stays the same
and
if it is HIGH and the payment method if is at a LOWER RISK then the SIC is changed to a LOWER RISK.

Question 5

Where to find MCC and SIC #’s?

Answer 5

MSA - view only system, North Mainframe

RMW - Used primarily by Security and MRM to perform account reviews

CARS - Collections and Reserve System used to track receivables and reserves held. View Only.

MAI - Credit Underwriting program with view and update capability for North platform merchants.

Question 6

The card processing industry, risk exposure is a function of what classifications?

Answer 6

Industry norms 
Deposit volumes 
Overall return rates 
NDX
Operational characteristics of a merchant's business

Question 7

What would be classified as extraordinary high risk?

Answer 7

Advanced payment andor delayed delivery with cardholders making full or partial payments prior to final service or product delivery.

Question 8

What would be classified as high-risk?

Answer 8

Required deposits or full payment prior to delivery of products or services. Non POS Mo/to or Internet transactions

Question 9

What are some characteristics of moderate risk?

Answer 9

Primarily point-of-sale operations, but made evident some level of advanced or partial payment and or delayed delivery

Question 10

What are some classifications of low-risk?

Answer 10

Primarily point-of-sale operations, with relatively insignificant, historical, overall return rate.