Every online gaming and gambling business is familiar with the challenges of the 7995, also known as the MCC or the merchant category codes which has been associated with gambling transactions in the past when all online gaming and gambling were prohibited.
Recently, however, with Delaware, Nevada and New Jersey permitting it to a certain degree, the absence of specific distinction becomes a problem with licensed institutions. And most banks instantly denying any transaction coded 7995 without the feeling of the need to investigate further.
New Merchant Category Codes
On the 17th of April 2015, the credit card brands including American Express, MasterCard, Visa, and Discover introduced the 3 new MCCs in order to segregate a licensed gambling business from the unlicensed ones.
These are the following:
- MCC 7800 which refers to the government-run online casinos and lotteries
- MCC 7801 which refers to the regulated online gambling casinos
- MCC 7802 which refers to the regulated events for dog and horse racing and betting
The idea of the new MCCs should offer reassurance to credit card processors, who initially have been concerned with being arrested under the UIGEA (Unlawful Internet Gambling Enforcement Act) of 2006. The end result should be reduced denied transactions since they no longer fail under the challenging 7995.
In addition, the new MCC is supplementary only to the list of secondary transaction codes used by most financial institutions in determining the kind of transactions for the approval that is being requested.
Meanwhile, the MCC 7995 used by VISA and the MCC 9754 used by MasterCard will remain and are recently declared as the main code for credit or debit card payments including the unregulated online gaming transactions.
However, only time should let us know whether these codes will have noticeable results or not. The most likely complication for these codes is the volume since some providers consider gambling sites too little to be worth considering with only 3 states have made the online gambling sector legal.
Another problem that could arise includes the risk of underage gamblers from out-of-state users. Thus, most banks and financial institutions still not consider it worthwhile for now.
New MCC 7995 Regulations: What It Means For Your Online Gambling Business?
With the UIGEA of 2006 law blocking the online payments via credit or debit cards, the simplest solution for the gambling business is to allow your clients to pay via wire transfer or online wallets like Google Wallet.
However, with the new MCCs approve licensed gambling websites, high-risk merchant account service providers may allow businesses in the online gambling industry to have merchant accounts easily.
As more and more states willingly make online gambling legal, merchant account providers are keener to offer credit card payment processing solutions to online gambling merchants. And with more cardholders being offered to several legal online gambling choices, the watchfulness and doubt of both processors and banks are also reduced. And with a reliable merchant account, the processing fee for debit or credit card payment processing is also reduced significantly.
However, even though the new MCC brings in several benefits, looking and acquiring an online gambling merchant account still provide potential challenges. Thus, it is only recommended that you go to merchant account providers who specialize in businesses that fall under the high-risk category.
Fantasy Sport Payment Processing Growth
Most established fantasy sports venues, like the online gambling sector, have experienced the same kind of problems in gaining the approval for processing debit or credit card payments in association with their commercial ventures.
However, with the new MCC solutions offers an element of optimism to the fantasy sports sector. These codes allow a fantasy sports business to accept and process payment transactions via credit and debit cards for those venues which are in compliance with the applicable law.
The new MCC, however, adds a requirement for fantasy sports businesses to acquire the advice from a qualified counsel in order to make sure that their operations are indeed compliant with the law. After ensuring that they are compliant, they should get an opinion letter that details this compliance in order to obtain their desired payment processing solution.
This ongoing change of payment processing and banking associated with the fantasy sports sectors as well as lawful online gambling continues to focus from online gaming attorneys, fantasy sports counsel and the concerns in payment processing.
Paving The Way For Greater Bank Recognition With The New Online Gambling Payment Processing Codes
Previously, numerous banks have been denying attempted payments via credit or debit cards that are related to the online gambling sector. This is because banks are concerned about the legality of the websites as well as the payments.
However with the newly designated MCCs, these concerns should be reduced and even help push banks’ interests towards the online gambling sector.
Need To Know More About Online Gambling Merchant Account?
If you want to know all about an online gambling merchant account, then visit iPayTotal and contact us.
We provide only the best credit card payment processing solutions for businesses that fall under high-risk or low-risk categories. Here at iPayTotal, we guarantee you top-notch services and fast, real-time credit or debit card processing at reasonable and competitive rates.
Get in touch with us via our website or call us directly at +44 800 776 5988.