Payment networks have paused their implementation of a new merchant category code for gun shops.
American Express, Discover, Mastercard and Visa have done so but have not said that they would end it completely, Reuters reported Thursday (March 9).
The move by the companies comes after several states raised concerns about improper tracking of consumer purchases, according to the report.
At the same time, gun-control advocates said that the companies were caving in to political intimidation and that the code could help spot purchasers who get around existing regulations concerning multiple purchases by buying a single gun at each of several different stores, the report said.
The dispute centers on a new merchant category code (MCC) that was approved in September by the International Organization for Standardization (ISO) and joins hundreds of other codes used to identify types of merchants by what they sell.
Gun shops were categorized as specialty retailers or durable-goods sellers — which are much broader categories — but the new MCC would be specific to firearms retailers.
In a statement provided to PYMNTS, a Visa spokesperson said that the firm aims to facilitate secure and reliable global commerce in compliance with applicable laws.
“Multiple U.S. states are considering legislation to prohibit or restrict the use of the new merchant category code (MCC) for gun and ammunition stores,” the Visa spokesperson said in the statement. “There is now significant confusion and legal uncertainty in the payments ecosystem, and the state actions disrupt the intent of global standards. Accordingly, Visa is pausing implementation of the MCC.”
Discover said in a statement provided to PYMNTS: “To continue alignment and interoperability with the industry, Discover is removing the new merchant category code identified as MCC 5723 from our April 23.1 Network Release.”
American Express and Mastercard did not immediately reply to PYMNTS’ request for comment.
A Mastercard spokesperson told Reuters that bills like those currently being considered by states would cause “inconsistency” in the application of the code.
“It’s for that reason that we have decided to pause work on the implementation of the firearms-specific MCC,” the Mastercard spokesperson said, per the report.