3623 Dorint hotels

Introduction

• What it is: This MCC represents businesses primarily involved in hotel accommodations.
• Risk level: Medium — Due to seasonal fluctuations in bookings and potential high chargebacks.
• Acceptance difficulty: Medium — While hotels are common, their variable revenue streams can complicate approval.
• Typical business models: hotels; resorts; inns; boutique accommodations; bed and breakfasts.
• For merchants: Expect moderate MDR rates; potential for reserve accounts during peak seasons; chargeback management is essential.
• What PSPs expect: Detailed information about the business operation; licenses if required; clear cancellation policy on the website.

Payment Insights & Benchmarks

Merchants in the lodging sector, specifically hotels like Dorint, should be prepared for unique payment challenges that can differ from standard e-commerce. The nature of travel bookings can lead to higher transaction volumes, varied payment methods, and specific consumer expectations.

Payment methods

Cards: predominant for reservations, but often result in higher declines for international transactions.

• E-wallets: becoming increasingly popular for deposits and cancellations, providing flexibility to guests.
• Direct bank transfers: gaining traction for large bookings, though not commonly preferred for individual reservations.
• Corporate billing solutions: essential for business travelers, but require robust credit checks.

Authentication & security

Strong Customer Authentication (SCA) measures are typically applied, which can lead to friction at the point of sale.

• Fraudulent bookings may spike in transient periods, requiring effective monitoring and mitigation strategies.
• Hotels should leverage behavioral analytics to spot anomalies during booking processes.

Benchmarks (indicative, not guaranteed)

MDR: generally higher than traditional retail due to the risk assessment related to chargebacks.

• Rolling reserves: may be applied for new accounts or high-risk bookings, often in the range of 5-10%.
• Settlement time: typically slower than standard e-commerce, often exceeding one week.
• Chargeback ratios: usually elevated in the hospitality sector, influenced by cancellations and no-show policies.
• Approval rates: can fluctuate significantly based on booking method; cards tend to be lower compared to e-wallets.

Key metrics to monitor

Booking conversion rates segmented by method and time of booking.

• Chargeback reasons categorized by booking type (prepaid vs. postpaid).
• Cancellation and no-show rates to gauge customer behavior.
• Average transaction values to assess pricing strategies and potential for fraud.

Risk & Compliance

Merchants under the MCC 3623 (DORINT HOTELS) are closely scrutinized due to elevated financial and reputational risks associated with the hospitality industry. PSPs and acquirers typically apply stricter controls, expecting merchants to proactively address fraud, chargebacks, and AML/KYC compliance.

Chargebacks & fraud

High incidence of friendly fraud where guests dispute valid charges (e.g., “I didn’t authorize this transaction”) after their stay.

• Common patterns include claims for non-existent services or unauthorized transactions on business cards.
• Mitigation tools include chargeback alerts, transaction monitoring, and thorough customer verification at check-in.

AML/KYC expectations

Strong customer identity verification (IDV) processes to check against sanctions and PEP lists.

• Source-of-funds verification, particularly for high-value bookings or group reservations.
• Manual review triggers include frequent high-value bookings, last-minute reservations, or payments from unusual geographic locations.

Operational red flags

Unclear ownership of the hotel or management structure, leading to transparency concerns.

• Traffic originating from non-traditional booking sites or unverified third-party agents.
• Lack of clear policies for cancellations, no-shows, and refunds, which can attract disputes.
• Absence of robust verification procedures for corporate accounts or long-term stays, increasing risk exposure.

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

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 payment limits; refund processes

Regulation & Licensing

Licensing and certification are critical for merchants in this MCC, as PSPs and acquirers will require proof of compliance before onboarding. Recognition of licenses depends heavily on the merchant’s jurisdiction and the markets they target.

Operator licenses

Hotel licenses — required in many jurisdictions, ensuring the establishment meets health and safety standards.

• Business operation permits — often necessary for hotels to operate legally within local municipalities.
• Liquor licenses — needed if the hotel serves alcohol, as regulations vary widely by region.
• Health and Safety regulations — compliance certificates maintaining standards for accommodation services.
• Tourism and hospitality regulatory compliance — some regions require specific licenses to operate within the tourism sector.

Geo-restrictions

Certain countries or regions may have strict hospitality licensing laws that could restrict operations for foreign hotels.

• In some jurisdictions, hotels operating without local authorization may face penalties or bans.
• Local regulations often dictate the types of services that can be offered, affecting hotel offerings and partnerships.

Certifications & audits

PCI DSS compliance for handling card data securely and protecting customer information.

• Health and safety inspections may be required periodically to maintain licensing.
• Annual audits for food safety if the hotel has dining facilities.
• ADA (Americans with Disabilities Act) compliance assessments to ensure accessibility for all guests.

Official Definitions & Network Comparisons

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

Explanation:

The definitions from each network share common themes, yet differences arise in terminology and focus. For example, Mastercard explicitly mentions the distinction between luxury and budget accommodations. Additionally, each network may have varied requirements for licensing and operational compliance, which play a crucial role during merchant onboarding. Common denial reasons may include inadequate licensing, location compliance issues, and insufficient operational documentation.

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 offers lodging services, it should be classified under MCC 3623. Attempting to classify under other codes can lead to compliance issues and potential disputes with payment processors. Always ensure your classification reflects the primary service offered.

Best Practices for Merchants

Merchants under the MCC 3623 - DORINT HOTELS must navigate a competitive and often scrutinized payment landscape. Following best practices is essential to fostering trust, enhancing customer experience, and minimizing operational risks.

Classification & transparency

always use the correct MCC; misclassification can lead to increased scrutiny and account issues

• clearly display your services, policies, and licenses on your website for transparency
• maintain well-defined descriptors to help customers recognize charges on their statements

Fraud & chargeback reduction

implement 3DS or step-up authentication, particularly for online reservations or high-risk transactions

• ensure billing descriptors are clear, and provide instant confirmations via SMS or email to reduce misunderstandings
• maintain logs of transaction events and customer interactions to support dispute representments if needed

Payment acceptance optimization

offer multiple payment methods (credit/debit cards, mobile wallets, and local payment options) to cater to diverse customer preferences

• regularly test the performance of different payment service providers (PSPs) and assess routing strategies based on geography and method
• consider using separate merchant IDs (MIDs) for different services or locations to align with varying scheme requirements

Operational discipline

track key performance indicators (KPIs) such as authorization rates, chargeback ratios, and customer lifetime value to enhance decision-making

• conduct periodic compliance audits and training for staff to ensure adherence to internal policies and best practices
• establish a dedicated process for handling disputes, ensuring timely responses and proper documentation

Payouts & liquidity

keep liquidity buffers in place to accommodate for rolling reserves, ensuring smooth cash flow for operations

• automate anti-money laundering (AML) checks for withdrawals, especially for significant amounts to mitigate risk
• monitor and review payout processes regularly to detect any unusual withdrawal behavior or trends

Business Scope & Examples

This MCC covers businesses primarily involved in providing lodging and accommodation services such as hotels, motels, and resorts. Merchants classified under this category usually offer paid stays and related services to travelers and guests, focusing on comfort and hospitality in physical locations.

Models

hotels (full-service and limited-service)

• motels (economical roadside lodging)
• boutique hotels (unique, stylish accommodations)
• resorts (luxury accommodations with recreational facilities)
• vacation rentals (short-term lodging)

Borderline cases

Timeshare properties — properties sold as shared ownership; may or may not fit under this MCC depending on business model.

• Hostels — budget-oriented, social sleeping arrangements; sometimes categorized differently based on amenities offered.

Signals for correct classification

business primarily offers paid overnight accommodations

• services include check-in, room service, and amenities like pools or gyms
• direct payment for stays is made by customers upon arrival or booking