3510 Days inns

Introduction

• What it is: This MCC covers establishments providing lodging services, particularly hotels and inns.
• Risk level: Medium — The hospitality industry is often volatile, influenced by tourism trends.
• Acceptance difficulty: Medium — While many processors accept hotel businesses, certain factors may complicate onboarding.
• Typical business models: hotels; motels; boutique inns; extended stay facilities.
• For merchants: Expect moderate MDR rates; may require reserves for chargebacks; thorough documentation needed for approvals.
• What PSPs expect: Proof of business operation; detailed descriptions of services offered; compliance with health and safety standards.

Payment Insights & Benchmarks

Merchants in this MCC should prepare for special considerations related to payment acceptance and the overall fluidity of transactions. The hospitality industry, particularly for accommodations like Days Inns, often involves higher customer expectations and unique payment behaviors.

Payment methods

Cards: primary method for bookings, but often impacted by fraud filters, leading to potential declines.

• E-wallets: gaining traction for convenience and speed, but acceptance varies by booking platform.
• Prepaid cards: a popular option for travelers, offering enhanced budget control and chargeback avoidance.
• Bank transfers: less common but can be used, especially for larger bookings or corporate clients.

Authentication & security

Strong Customer Authentication (SCA) is frequently required, particularly for online bookings.

• 3DS is often utilized to mitigate fraud, but can contribute to cart abandonment if not optimized.
• Continuous fraud monitoring should address patterns unique to the hospitality sector, including seasonal fluctuations.

Benchmarks (indicative, not guaranteed)

MDR: generally higher than standard e-commerce due to fraud risk.

• Rolling reserves: may be necessary, particularly for high-risk bookings.
• Settlement cycles: typically longer, often exceeding a week.
• Chargeback ratios: can be elevated due to dissatisfaction or disputes with services rendered.
• Approval rates: may be lower for card transactions, especially from international guests.

Key metrics to monitor

Authorization success rates segmented by booking channel (website, app, phone).

• Chargeback reasons analyzed for trends related to service quality or operational issues.
• Refund rates and their impact on cash flow management.
• Average booking value compared to customer segments to identify profitable markets.

Risk & Compliance

Merchants in the hotel and lodging industry, particularly those categorized under this MCC, face significant scrutiny due to the high potential for fraud and chargebacks. PSPs and acquirers implement strict compliance measures, necessitating that merchants remain vigilant in addressing risks related to customer disputes and adhering to AML/KYC requirements.

Chargebacks & fraud

Common chargeback reasons include friendly fraud wherein customers dispute charges claiming they did not authorize the transaction, alongside legitimate cancellations and no-shows.

• Fraud techniques may include the use of stolen credit cards for reservations, often leading to chargebacks after the stay.
• Effective mitigation tools include chargeback alerts and review systems, alongside fraud detection technologies such as velocity checks and behavioral analytics.

AML/KYC expectations

PSPs require strong identity verification processes, including government-issued ID checks and comprehensive sanctions list screenings.

• Regular source-of-funds assessments are necessary, especially for large reservations or unusual payment patterns.
• Manual review triggers may arise from reservations made with multiple credit cards, last-minute bookings, or prolonged stays by high-risk individuals.

Operational red flags

Lack of transparency regarding ownership, especially in franchise models that may obscure the identity of operators.

• Use of anonymous payment methods or acceptance of prepaid cards may signal operational concern.
• Absence of clear cancellation and refund policies can raise alarms; merchants must ensure these are communicated effectively.
• Inconsistencies in customer communication or customer service responses can indicate operational weaknesses that may be exploited by fraudsters.

Onboarding Checklist

Merchants under this MCC should prepare a complete onboarding package before approaching PSPs or acquirers. A well-structured submission improves approval chances and shortens review times.

Legal & corporate documents

company registration and incorporation documents

• disclosure of beneficial owners (UBO) and corporate structure
• valid licenses for the relevant business activities
• policies: Terms of Service, Privacy, AML/KYC, Refund Policy

Financials & risk management

recent financial statements and cashflow forecasts

• liquidity or reserve model for payouts
• description of antifraud setup and monitoring tools

Product & marketing

demo access or screenshots of the live platform

• marketing plan and traffic source overview (affiliates, SEO, PPC)
• geographic targeting information
• KYC flow details, including IDV providers and thresholds

Technical integration & security

payment architecture overview with supported methods/providers

• description of SCA/3DS flows, retry logic, and tokenization
• PCI DSS compliance status and data storage policy

Operations

customer support coverage (languages, 24/7 if available)

• SLA for dispute handling and chargeback response
• deposit and cancellation policies; self-exclusion mechanisms
• internal process for chargeback investigation and documentation

Regulation & Licensing

Licensing and certification are essential for merchants in this MCC, particularly for those in the hospitality sector, as they establish credibility and compliance with local regulations. Recognition of licenses and certifications will vary based on the merchant's jurisdiction and targeted market.

Operator licenses

State or local business licenses — required for all operating businesses, ensuring adherence to local regulations.

• Hotel or lodging license — specific to hospitality businesses, mandated in many jurisdictions to operate.
• Health and safety permits — important for ensuring compliance with sanitation and safety standards.
• Alcohol licensing (if applicable) — necessary for establishments serving alcoholic beverages, recognized differently across regions.
• Some areas may require specific tourism or travel-related licenses to attract visitors.

Geo-restrictions

Operating in cities or states with specific hotel regulations may limit the ability to serve certain locations.

• Certain jurisdictions impose restrictions on short-term rentals in residential zones, impacting booking capabilities.
• Local zoning laws can affect the development and operation of lodging facilities.

Certifications & audits

PCI DSS compliance for handling card payments securely.

• Health and safety audits to ensure proper sanitation and safety practices are followed.
• Fire safety certifications are essential for lodging establishments to ensure guest safety.
• Environmental certifications may be requested for sustainable practices in hotel operations.

Official Definitions & Network Comparisons

This section shows how major card networks define this MCC and highlights practical differences that affect merchant onboarding.

Explanation:

Although all networks classify this MCC under lodging, variations in definitions and emphasis (e.g., "establishments" vs "similar lodging") can lead to differences in onboarding procedures. For instance, some networks may prioritize documented proof of legitimate operations or compliance with local licensing laws. Common rejection reasons can include insufficient documentation of operations, non-compliance with health codes, and high-risk geographical locations.

Alternative MCC Codes

Merchants often confuse this MCC with other categories. The table below shows which codes are related, why they are confused, and what risks misclassification brings.

Rule of thumb for merchants:

If your business primarily provides lodging, it should be classified under MCC 3510. Misclassifying under another code can lead to compliance issues and potential penalties, especially if the services do not align with hotel accommodations.

Best Practices for Merchants

Merchants operating under the MCC 3510 (DAYS INNS) must adhere to best practices that ensure smooth operations, minimize risks, and enhance customer trust. By following these guidelines, you can optimize payment acceptance, reduce disputes, and foster strong relationships with payment service providers.

Classification & transparency

always use the correct MCC; inaccurate classification could lead to compliance issues and account termination

• display clear information on your website regarding booking policies, cancellation fees, and other relevant details
• ensure transparent descriptors on customer statements to avoid confusion and increase trust

Fraud & chargeback reduction

implement 3DS or step-up authentication especially during high-risk transactions such as large bookings or last-minute reservations

• utilize clear billing descriptors and confirm bookings via email or SMS to ensure customers recognize the charge
• maintain detailed logs of transactions and booking details to support your case in the event of disputes

Payment acceptance optimization

accept various payment methods including credit/debit cards, digital wallets, and third-party services to appeal to a broader audience

• analyze transaction data to identify geographical trends and optimize routing to different PSPs for better approval rates
• consider using separate MIDs for different services (e.g., rooms vs. amenities) to tailor payment strategies based on specific transaction types

Operational discipline

establish KPIs to monitor payment performance, including authorization rates, chargeback ratios, and customer satisfaction scores

• conduct regular compliance audits to ensure adherence to policies and industry regulations, adjusting as necessary
• create clear processes with designated individuals for handling disputes and ensure timely responses to customer inquiries

Payouts & liquidity

keep a buffer for rolling reserves to handle fluctuations and ensure smooth cash flow during peak seasons

• implement automated AML checks for payouts, particularly for large transactions that may raise red flags
• regularly review payout processes to minimize delays and ensure timely availability of funds for your operations

Business Scope & Examples

This MCC is designated for lodging establishments that primarily offer temporary accommodations for guests. Merchants classified under this category typically provide room rentals and related services, focusing on the hospitality and travel sector. The scope includes businesses that cater to travelers looking for overnight or short-term stays.

Models

hotels and motels

• bed and breakfast establishments
• vacation rental services
• hostels and shared accommodations
• boutique inns and lodges

Borderline cases

Time-share properties — often involve prepaid arrangements for vacation accommodations; however, they diverge from typical lodging classifications.

• Airbnb and similar platforms — while these services provide accommodations, they may not fit neatly into this MCC depending on the rental model used (e.g., short-term vs. long-term stays).
• Corporate housing — furnished rentals for business travelers; may also require separate classification compared to standard lodging.

Signals for correct classification

primary business model is short-term rental of rooms or accommodations

• services include housecleaning, concierge, or on-site dining options
• majority of revenue is derived from lodging fees rather than ancillary services