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Credits cards have many different ways of offering you points on types of goods or services you pay for. How do they know if I'm buying, say, food or gas?

There are so many different different businesses around; how would a credit card company know to not award me food points when paying for laundry at a laundry mat?

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    There is a bunch of info that the merchant sends along with the card number and price when they submit the transaction. Depending on the card and the merchant, it can be very detailed.
    – zeta-band
    Commented Jun 13, 2019 at 19:19

2 Answers 2

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They Do this using the Merchant Category Code. See https://en.wikipedia.org/wiki/Merchant_category_code.

This is assigned to the merchant when they sign up with the bank that is going to handle their payments. And this code will be part of the meta-data that gets associated with the transaction that you do.

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    Current Visa documentation, just for reference.
    – Bobson
    Commented Jun 13, 2019 at 13:16
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    So if you're wondering whether a store is eligible for a promotion, you can try asking your card issuer what MCCs are included, then ask the the store what their MCC is. I wouldn't imagine most clerks know what their MCC is, though. Commented Jun 13, 2019 at 20:54
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    It's a fascinating and oddly arbitrary list, based on the link in the wiki page. Some categories seem to have multiple entries for some reason, and a lot of well known companies have their own exclusive MCC, but also quite a few I've never heard of. Commented Jun 14, 2019 at 10:56
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    @Crazymoomin There is even an entry for the long defunct national airline of my country. :D
    – Nobody
    Commented Jun 16, 2019 at 7:46
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They don't (through this route at least) know what you're buying, just where. So if you go to your gas station and buy food and no fuel it will display just the same as if you bought fuel. I've just checked one of my cards, and the instore cafe at the supermarket shows up exactly the same as buying groceries ("Grocery Stores, Supermarkets") but the petrol station* on the same site is "Service Stations (with or without Ancillary Products)".

Companies sometimes try to use this field to enforce expense policies (like "no alcohol on expenses", "fuel only to be bought on the fuel card in the car, not your company credit card") but this causes problems for legitimate purchases (like buying sandwiches at a petrol station - the card is meant to buy food when travelling, but it looks like you bought fuel) without preventing illegitimate purchases (buy a cheap meal and an expensive bottle of wine in a supermarket). It's mainly useful for you to work out where a transaction you forgot about took place


* UK terminology

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  • I would say that buying sandwiches on a fuel card isn't a legitimate purchase. A fuel card is probably only going to be valid at outside, automated pumps (Automated Fuel Dispensers), and not for any use inside.
    – Bobson
    Commented Jun 13, 2019 at 13:16
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    @Bobson you can't, you can only buy fuel on such a card. I'll try to clarify in the answer, but I meant using the card meant for subsistence as intended, but because food isn't the retailer's main business it looks wrong.
    – Chris H
    Commented Jun 13, 2019 at 13:21
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    Some retailers do tell the card provider exactly what you’re buying; this is level 3 card transaction data. Commented Jun 13, 2019 at 14:08
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    Oh, OK, I didn’t get that restriction from the question ;-). (I get credit card statements with purchase summaries corresponding to L3 data, incidentally.) Commented Jun 13, 2019 at 14:36
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    "I've just checked one of my cards, and the instore cafe at the supermarket shows up exactly the same as buying groceries" I think the one consistent thing is, it's not consistent. Some bigger retailers (i.e. Target) will use a different MCC for the POS in the electronics department or the in-store pharmacy vs the front registers, others don't. The inconsistency is really frustrating if you're trying to model this data in bulk.
    – dwizum
    Commented Jun 14, 2019 at 17:04

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