What is MCC code 8398?

What is MCC 8398? See its business impact and how to verify it. Get JIM on iOS/Android for 1.99% flat-rate, instant payments.

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Mar 20, 2026

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2 min read time

The International Organization for Standardization (ISO) uses MCC 8398 to classify charitable or social services organizations. This code covers transactions from businesses that offer community support, including counseling, welfare, and relief services. It also applies to organizations that focus on raising funds or soliciting donations for social welfare causes. These can range from local community centers to large non-profit groups.

Which businesses fall under MCC 8398?

MCC 8398 applies to a broad range of social service establishments:

Charitable thrift stores: These stores, like Goodwill or The Salvation Army, sell donated items to the public. The revenue generated supports their broader social service missions and community programs.
Humanitarian relief organizations: Groups such as the American Red Cross and UNICEF fall under this code when accepting donations. They provide disaster response, emergency assistance, and international development support.
Community food banks: Establishments that collect and distribute food to individuals and families facing hunger use this code. Feeding America is a prominent national network of such organizations.
Youth development programs: Organizations focused on young people, like the Boy Scouts of America or Big Brothers Big Sisters, use this MCC. They accept payments for memberships and donations for their programs.
Animal welfare organizations: This category includes groups like the ASPCA and The Humane Society of the United States. They accept donations to fund animal rescue, shelter, and advocacy efforts.
Broad-based fundraising foundations: Organizations like United Way collect contributions from the public and corporations. They then distribute the funds to a network of affiliated local charities and service agencies.
Family and community counseling services: Non-profit providers that offer counseling, welfare, and support services use this code for payments. These can include family service agencies or community mental health centers.

Business implications of MCC 8398

Payment networks including Visa, Mastercard, American Express, and Discover use MCC 8398 to categorize transactions, which affects several aspects of business operations. These payment networks use the code to deduce the risk level of a business. For charitable organizations under MCC 8398, this often translates to lower interchange fees, as they are typically viewed as lower-risk merchants.

Beyond risk assessment and transaction fees, the MCC code informs other operational aspects. It provides a standardized way to classify expenses and analyze spending, which has further implications for financial management and customer engagement.

Expense tracking

Companies use MCCs to automatically sort business expenses on card statements. For purchases or donations coded as 8398, this simplifies the identification of tax-deductible contributions to qualified charitable organizations, streamlining financial record-keeping for tax purposes.

Financial analysis

Businesses can analyze spending data associated with MCC 8398 to understand their philanthropic contributions or other social service expenditures. This analysis helps with budget management, cost tracking over time, and forecasting future charitable spending for corporate social responsibility reports.

Compliance and auditing

The consistent application of MCC 8398 creates a clear audit trail. This simplifies the process for internal and external auditors to verify expenses and confirm compliance with company policies on charitable giving.

Rewards and customer behavior

Credit card issuers often offer bonus rewards for donations to charities. When a transaction is coded with MCC 8398, it can trigger these rewards, potentially influencing a cardholder’s decision to donate to a particular organization over another.

How to verify your business's MCC

Charitable organization owners should confirm their MCC classification to ensure proper transaction processing and avoid customer confusion regarding rewards eligibility. If you find out that your business is incorrectly classified—for example, a community food bank coded as a grocery store—contact your payment processor immediately to request reclassification.

Here's how to verify if your MCC classification is set up correctly:

Contact Your Payment Processor: Your merchant services provider assigned the MCC when you opened your account. Contact their customer service department or review the details in your merchant agreement to confirm your classification.
Review Processing Statements: Your monthly merchant statements often display the assigned MCC. Look for a four-digit number, typically located in the account information or business profile section of the document, to find your current code.
Check with Your Acquirer: The acquiring bank or financial institution that processes your transactions maintains the MCC code in their system. You can reach out to their merchant support team, and they can confirm your current classification.
Test Transaction Method: Some merchants run a small test transaction and then check how it appears on a personal credit card statement. This method is less reliable than direct confirmation from your processor, as statement descriptions can sometimes be generic.

How to choose a reliable payment service provider

Your MCC 8398 classification affects interchange rates, making your choice of payment processor important. Providers handle these transactions differently, and variations in pricing, settlement speed, and support impact your operations. Consider the following factors when you select a provider.

Transparent pricing: Flat-rate pricing offers predictability over complex models, which helps organizations manage budgets. The JIM tap-to-pay app for iPhone and Android charges 1.99% per transaction with no setup costs, monthly fees, or premium card surcharges.
Payment method support: Processors should accept major cards and digital wallets like Apple Pay and Google Pay. This meets customer expectations and simplifies donations by supporting Visa, Mastercard, and Discover.
Fast fund access: Quick access to funds is important for daily operations. For organizations under MCC 8398, this means having cash for immediate needs like restocking inventory, making supplier payments, or covering payroll without delay.
Security: Protect donor data with a processor that uses encryption and tokenization. JIM uses tokenization for every transaction, so card numbers are never stored on your device, which reduces your compliance burden.
Reporting: Look for a provider that offers clear financial analytics. JIM's AI assistant provides sales reports and transaction history through a chat interface, simplifying expense tracking and financial review.

Streamline payments with JIM

JIM offers charitable organization owners a straightforward payment process solution. The JIM tap-to-pay app transforms your iPhone or Android device into a tap-to-pay terminal with no extra hardware. It uses NFC technology to accept payments directly on your phone. You pay a flat 1.99% per transaction. There are no setup costs, monthly fees, or variable rates for premium cards.

For remote donations, you can create link payments (ideal for online donation drives) for 4.99% + $0.30 per sale. Your funds become available instantly on your JIM Visa Prepaid Card. You can add this card to Apple Pay or Google Pay for immediate use. This gives you direct access to your revenue for operational expenses.

Frequently asked questions about 8398

What is Merchant Category Code 8398?

Merchant Category Code 8398 is a four-digit classification number assigned to charitable and social service organizations by payment networks and the ISO. This code identifies transactions from non-profits, humanitarian groups, and community support services. Payment processors use this classification to determine interchange fees, create financial reports, and manage cardholder rewards programs.

Is Merchant Category Code 8398 high-risk?

Payment processors classify Merchant Category Code 8398 as low-risk. This classification stems from the low likelihood of chargebacks, as donations are less frequently disputed than commercial transactions. Consequently, organizations under this code often benefit from more favorable interchange rates, which reduces their payment processing costs and supports their missions.

Can a business have multiple MCC codes?

Generally, a business operates under a single merchant account, which is assigned one primary MCC based on its main source of revenue. However, if a company has distinct business lines, it can open separate merchant accounts, each with its own appropriate MCC. For instance, a for-profit coffee shop might establish a separate non-profit foundation to support local community projects. This foundation would have its own merchant account classified under MCC 8398 to process donations, keeping its financial activities distinct from the coffee shop's sales.

What happens if my MCC code is wrong?

An incorrect MCC code creates several negative consequences. For customers, it can mean missing out on expected credit card rewards for their donations, which may affect their satisfaction and future giving choices. For your business, a misclassification can lead to improper interchange rates. This could result in higher processing fees or, conversely, put you in violation of network rules for receiving preferential rates not meant for your industry.

Can merchants choose their MCC code?

A business cannot arbitrarily pick its MCC code. The payment processor determines the classification by evaluating the merchant's primary source of income against ISO standards and card network rules. While you cannot choose the code yourself, you can dispute an incorrect classification. If your code does not reflect your business model, you should contact your provider to ask for a re-evaluation and reclassification.

How does MCC 8398 affect my payment processing costs?

MCC 8398 directly influences the interchange rates you pay on each transaction. Since payment networks classify charitable organizations as low-risk, this code typically qualifies for some of the lowest available interchange rates, a distinct advantage over higher-risk industries. The exact savings you realize, however, depends on your payment processor’s pricing structure.

An interchange-plus model passes these lower rates directly to you, but your costs will fluctuate with every card used. In contrast, flat-rate processors like JIM absorb the variability and charge you a consistent fee regardless of card type.