5172 Petroleum and petroleum products

Introduction

• What it is: This MCC covers businesses primarily selling petroleum and related products.
• Risk level: High — Extremely volatile market and regulatory scrutiny increase risk.
• Acceptance difficulty: Medium — Requires robust compliance measures for processing.
• Typical business models: gas stations; fuel distributors; oil refineries; diesel supply companies; propane retailers.
• For merchants: Expect higher MDR; potential for reserve requirements; thorough transaction monitoring.
• What PSPs expect: Detailed business plan; proof of industry compliance; supply chain documentation.

Payment Insights & Benchmarks

Merchants in the Petroleum and Petroleum Products MCC should prepare for specific challenges related to payments, including fluctuating approval rates and potentially higher chargeback ratios. Understanding payment dynamics in this sector is crucial to optimizing transaction success and managing costs effectively.

Payment methods

Cards: commonly accepted, but transactions are scrutinized for fraud, leading to lower approval rates.

• Fleet cards: tailored for fuel purchases, widely used by commercial customers.
• Mobile wallets: gaining traction, but varied acceptance across regions and providers.
• A2A transfers: are becoming increasingly important, offering quick settlement options for commercial transactions.

Authentication & security

Strong customer authentication (SCA) is frequently required, particularly for higher-value transactions.

• Fraud prevention measures are essential due to the sector's vulnerability to criminal activity.
• Dynamic risk assessment tools can enhance transaction approval while maintaining security.

Benchmarks (indicative, not guaranteed)

MDR: generally higher compared to standard e-commerce due to risk factors.

• Rolling reserves: often applied, typically starting at a higher percentage to mitigate risk.
• Settlement time: usually longer, often exceeding 5 days in some cases.
• Chargeback ratios: can be elevated due to the nature of the transactions and customer disputes.
• Approval rates: generally lower relative to non-petroleum sectors, influenced by heavy fraud monitoring.

Key metrics to monitor

Transaction approval rates segmented by payment method and customer type.

• Average chargeback values and dispute reasons to identify potential fraud patterns.
• Decline rates by transaction type to pinpoint areas for improvement.
• Volume and frequency of high-value transactions to manage risk and optimize cash flow.

Risk & Compliance

Merchants operating under MCC 5172 face significant scrutiny due to the potential for fraud, chargebacks, and compliance risks associated with the sale of petroleum and petroleum products. PSPs and acquirers impose strict controls, necessitating that merchants actively manage these risks to maintain compliance and ensure safe operations.

Chargebacks & fraud

Frequent occurrence of friendly fraud, where customers claim unauthorized transactions after purchases.

• Instances of chargebacks related to fuel disputes and non-delivery of products.
• Use of stolen credit cards for purchasing gas and other petroleum products is common.
• Mitigation tools include implementing vehicle checks at pumps, deposit/withdrawal limits for pre-paid options, and monitoring transaction patterns with behavioral analytics.

AML/KYC expectations

Merchants should perform robust identity verification checks, including government-issued ID and proof of address.

• Sanctions checks and politically exposed person (PEP) screenings are critical, especially for commercial accounts.
• Source-of-funds verification is required for bulk purchases or credit line extensions, with manual review triggers for large transactions or inconsistent buying behavior.

Operational red flags

Unclear ownership or operating structures, especially in franchises or independent dealer settings, can raise transparency concerns.

• Traffic sources from unverified partners or geographical regions with high fraud rates are concerning.
• Lack of mechanisms to monitor and manage suspicious activity, such as unusual volume transactions or customer complaints.
• Insufficient policies on refunds and dispute resolution may signal operational weaknesses that PSPs will notice.

Onboarding Checklist

Merchants under the Petroleum and Petroleum Products 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, bet, and payout limits; self-exclusion mechanisms
• internal process for chargeback investigation and documentation

Regulation & Licensing

Licensing and certification are essential for merchants in the petroleum and petroleum products MCC, as regulatory compliance is key to maintaining safety and environmental standards in this industry. Recognition of licenses can vary significantly based on jurisdiction and the specific markets targeted by the merchant.

Operator licenses

Environmental Protection Agency (EPA) permits — required in the U.S. to manage environmental impacts of operations.

• State-specific oil and gas licenses — various states have their own regulations that must be adhered to for exploration and production.
• Fuel dealer licenses — necessary for businesses that distribute fuel in many jurisdictions.
• International Energy Agency (IEA) compliance — important for firms operating in multiple countries subject to international regulations.
• Local business operation permits — often required for retail and distribution outlets.

Geo-restrictions

Strict regulations in certain countries prohibit the import and export of petroleum products without proper licenses.

• Some regions have embargoes or sanctions affecting oil and gas trade, restricting transactions with specific nations.
• Local regulations in the EU may limit operations based on environmental concerns, creating barriers for certain types of transactions.

Certifications & audits

ISO 14001 for environmental management systems to ensure sustainable practices.

• Safety audits as per Occupational Safety and Health Administration (OSHA) guidelines.
• Compliance with API (American Petroleum Institute) standards for quality assurance.
• Regular environmental audits to assess compliance with regulations and sustainability practices.

Official Definitions & Network Comparisons

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

Explanation:

While the definitions focus mainly on the sale of petroleum and related products, there are nuances in compliance and regulatory focus among networks. Specific licensing and local regulations are emphasized by Visa, while Mastercard may require extra documentation. Additionally, some networks impose geographic restrictions and consider environmental compliance a factor. Common denial reasons include failure to meet regulatory requirements, unclear transaction types, and lack of necessary licenses.

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 sells petroleum products, ensure you are using MCC 5172. Misclassifying under codes related to wholesale or grocery can lead to compliance issues and potential account penalties. Always choose the MCC that best represents your main revenue stream.

Best Practices for Merchants

Merchants in the petroleum and petroleum products sector face unique challenges and regulatory scrutiny. Implementing best practices is vital to optimize payment processes, mitigate risks, and enhance customer experience.

Classification & transparency

always use the correct MCC for petroleum sales; incorrect classification can lead to account restrictions

• clearly display pricing policies, such as fuel surcharges, and any geographic limitations on your website
• provide transparent information regarding loyalty programs, rewards, and discounts to customers

Fraud & chargeback reduction

implement 3DS or step-up authentication for transactions flagged as high-risk, such as large fuel purchases

• ensure billing descriptors are clear on customer statements to prevent confusion and disputes
• log transaction details and customer interactions to support dispute representments effectively

Payment acceptance optimization

offer various payment methods (credit cards, debits, digital wallets) to meet diverse customer preferences

• utilize geo-routing for processing transactions to optimize acceptance rates based on location
• consider A/B testing of different PSPs to identify which provider yields the best transaction success rates

Operational discipline

monitor KPIs such as transaction approval rates, decline ratios, and chargeback trends regularly

• perform compliance audits involving transaction reviews and updates to your internal policies
• have a designated team or individual responsible for managing disputes and ensuring timely resolutions

Payouts & liquidity

maintain adequate liquidity reserves to support rolling reserves and potential chargebacks

• automate anti-money laundering (AML) checks, especially for large withdrawal requests
• keep track of payout patterns and strengthen fraud detection mechanisms for unusual withdrawal activity

Business Scope & Examples

This MCC encompasses businesses primarily involved in the sale or distribution of petroleum and petroleum products. Merchants in this category typically operate gas stations, fuel distributors, and suppliers of various petroleum-based products essential for automotive and industrial applications.

Models

gasoline service stations

• fuel oil dealers
• propane dealers
• lubricating oil and grease distributors
• aviation fuel suppliers

Borderline cases

Alternative fuel stations — businesses providing charging stations for electric vehicles may not always fall under this MCC; their classification can depend on the primary fuel type offered.

• Fuel card services — platforms that manage payment systems for purchasing fuel might have overlapping characteristics, but they do not sell fuel themselves.

Signals for correct classification

the primary business purpose is selling or distributing petroleum or petroleum-derived products

• transactions involve direct sales of fuel to consumers or businesses
• the merchant operates physical locations dedicated to fuel sales, like gas stations