DEFINITION
MCC Database / 5968: Direct Marketing – Continuity/Subscription Merchants
Every merchant is assigned a merchant category code (MCC) — a four-digit number used by card networks to classify the primary business activity. MCCs determine how transactions are processed, how fees are structured, and how risk is assessed.
Let’s take a closer look at MCC 5968.
What is MCC 5968?
MCC 5968 is designated for merchants that offer products or services on a continuity or subscription basis.
These businesses typically bill customers automatically on a scheduled basis (monthly, quarterly, yearly, etc.) until they cancel. Examples include:
- Subscription boxes: Curated items like beauty products, nutraceuticals, snacks, meal kits, or pet supplies.
- Digital media and entertainment: Streaming platforms or online newspaper subscriptions.
This MCC is particularly relevant for businesses employing negative option billing, where the customer’s silence or failure to cancel serves as consent to continue the service.
Is MCC 5968 considered high risk?
Yes. MCC 5968 is widely viewed as high risk by acquiring banks and card networks. This is due to several factors:
- Negative option billing: Automatically enrolling customers into ongoing payments can trigger disputes if not managed transparently.
- Elevated chargeback ratios: Ongoing billing cycles mean customers may forget about or overlook charges, leading to disputes.
- Regulatory attention: Authorities closely watch subscription-based models for compliance with consumer protection rules.
Because of these factors, processors often apply additional safeguards, such as:
- Reserve accounts: Holding a portion of settlement funds to cover future chargebacks.
- Enhanced oversight: Frequent reviews of billing practices and refund rates.
- Detailed onboarding requirements: Disclosure of subscription terms, trial offers, and cancellation procedures during underwriting.
Does MCC 5968 require a license?
Yes. Subscription merchants must follow strict card network and legal guidelines, which can include the following:
- Clear billing terms: Upfront disclosure of costs, billing intervals, and trial period conditions.
- Affirmative consent: Explicit customer agreement before initiating recurring charges.
- Accessible cancellation options: Simple, visible, one-click methods for ending the subscription.
- Proactive notifications: Advance reminders before renewal or post-trial billing, as required by some networks.
Failure to meet these requirements can lead to higher monitoring, penalties, or loss of merchant privileges.
Does MCC 5968 have special fees or pricing?
Typically, yes. Processors often adjust pricing for subscription-based businesses.
- Higher interchange categories reflect the elevated risk tied to recurring billing.
- Reserves or holds retain a portion of revenue to cover potential chargeback losses.
- Additional risk fees may be charged monthly or per-transaction for compliance oversight.
Your exact rates depend on your processor’s risk assessment, your dispute history, and your transaction patterns.
Can I have multiple MCCs if I offer multiple services?
It’s possible — if each service is operated independently with its own merchant account.
For example, a merchant selling monthly subscription boxes (MCC 5968) and also running a separate one-time sales shop (MCC 5969) could maintain two MCCs.
But if the services are part of a single merchant account, the MCC will be based on the main revenue driver.
What are some similar MCCs?
There are several MCCs that are similar to 5968.
Depending on your business model, one of these alternative MCCs might be assigned instead.
Ready to Optimize Payment Processing for Your Subscription-Based Business?
AltoPay works with subscription merchants across industries — from digital content providers to subscription box services. We provide merchant accounts optimised for your business, customised processing rates that reflect your risk profile, and expert chargeback prevention support.
Reach out today to learn more.
FREQUENTLY ASKED QUESTIONS
What else do I need to know about MCCs?
Are MCCs the same across all card networks and acquirers?
Card networks do roughly follow the same classification framework, but acquirer and processor interpretation can vary. One acquirer might classify your business differently from another, even if your product offering is the same during both applications.
Who decides my MCC?
Your processor or acquiring bank assigns your MCC when setting up your account. They identify your main revenue source and select the MCC that best fits.
How do I know what my MCC is?
Your MCC is usually listed on your merchant agreement and in your processing dashboard. You can also check your VAR sheet (which might be called a registration form, onboarding sheet, or MID credential form). If all else fails, contact your acquirer, processor, or solution provider for clarification.
Does my MCC affect my interchange rate?
Yes. Your MCC affects which interchange rates are applied to your transactions. Riskier MCCs generally have higher processing rates.
Can my MCC affect my ability to process payments?
Sometimes. Processors and acquirers often set limits on which MCCs will be accepted. Applications that are approved might have volume restrictions, increased reserves, or required chargeback management efforts.
How often can my MCC change?
Your MCC will be unchanged — unless your core business activity changes. You can be reassigned a new code if your current code is no longer relevant. To support your request, you’ll be asked to provide documents to help prove your current business model.
What happens if I’m misclassified with the wrong MCC?
It is important to have a true and accurate MCC. If you don’t think the MCC assigned to your business is a good fit, reach out to your processor or acquirer. You can request a reevaluation with documentation such as marketing materials or an inventory list to show your true focus.
