Utility Programs

Visa introduced the Visa Utility rate in April 2005 and MasterCard in October 2006. This rate is specific to the utility industry, MCC 4900 and is targeted toward the recurring payments market, specifically utility bills. The current Visa and MasterCard Utility Interchange rate is $0.75 for both consumer credit and debit transactions that meet category requirements.

Merchant Requirements:

To be eligible for the Visa Utility IRF Program, a utility merchant must:

Applies only to merchants processing transactions with a Merchant Category Code of 4900 (Utilities: Electric, Gas, Sanitation, Water) who have registered for the program. MERCHANTS PROVIDING TELECOMMUNICATION OR CABLE SERVICES ARE NOT ELIGIBLE FOR MCC 4900 as these services are included within other MCCs. Additionally, Visa does not consider heating oil or propane as a utility and they are not eligible for the Utility rate.

Accept Visa credit or debit cards, as applicable, as payment in all channels in which the merchant does credit or debit card business.

Be registered as part of the Visa Utility Program and submit a Merchant Verification Value (MVV) with transactions
Not charge fees of any type to cardholders for processing Visa transactions (Similarly a third party processor or bill service provider acting as a vendor to the utility must not charge any fees to cardholders for processing Visa transactions.)

Include the bill payment indicator on all bill payment transactions

If capable of accepting recurring payments, include the recurring payments indicator in the authorization and clearing record of all recurring transactions.

Communicate Visa acceptance to cardholders and to customers at parity with other payment card brands.

To be eligible for the MasterCard Utility program, a utility merchant must:

Applies only to merchants processing transactions with a Merchant Category Code of 4900 (Utilities: Electric, Gas, Heating Oil, Propane, Sanitation, Water) who have registered for the program. MERCHANTS PROVIDING TELECOMMUNICATION OR CABLE SERVICES ARE NOT ELIGIBLE FOR MCC 4900 as these services are included within other MCCs.

Accept MasterCard credit or debit cards, as applicable, as payment in all channels in which the merchant does credit or debit card business.

Be registered as part of the MasterCard utility program and submit the Program Registration Identifier code (UXX) with all transactions submitted for each of the new utility interchange rate programs.

The merchant must not directly or indirectly require any MasterCard cardholder to pay a surcharge or any part of any merchant discount or any contemporaneous finance charge in connection with a MasterCard transaction. A merchant may, however, offer a discount to its customers for cash payments, or charge a fee (such as a bona fide commission, postage, expedited service, or convenience fee) provided the fee is imposed on all like transactions regardless of the form of payment used.

Process the sale of utility services, if a third-party payment facilitator is used, as a separate transaction from any convenience fee charged by a third-party payment facilitator for its own services provided to the cardholder. Such convenience fees do not qualify for the utility interchange rate.

Ensure that the acquirer passes the recurring payments indicator in the authorization record, if the merchant accepts recurring payments.

Communicate MasterCard acceptance to cardholders and to customers at parity with other payment card brands.