MDR and MCC

Question 1

What is MDR?

Answer 1

Merchant Discount Rate

Question 2

What is MCC?

Answer 2

Merchant Category Code

Question 3

Define Merchant Discount Rate

Answer 3

A fee charged to a merchant by a payment processor for processing card transactions, usually a percentage of the transaction amount.

Question 4

Define Merchant Category Code

Answer 4

A four-digit code used to classify businesses based on the goods and services they provide.

Question 5

How are Merchant Category Codes (MCCs) used to block transactions on a card?

Answer 5

MCCs help banks block transactions from certain merchants based on factors like fraud risk, regulations, or cardholder preferences.

Question 6

How can using a Merchant Category Code (MCC) help offer higher rewards to cardholders?

Answer 6

MCCs identify the merchant’s category, allowing credit card issuers to offer higher rewards or cashback for transactions made in certain categories, like restaurants, travel, or groceries, based on the cardholder’s reward program.