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FFL and tactical payment gateway news – updated 06/20/2025 –

This page contains regularly updated information on firearms and tactical e-commerce based on information from merchant account underwriters, payment gateway providers, independent agents, publications, and payment industry executives.

Note: You must sit with a qualified attorney before launching a firearms or tactical website. All firearms must be shipped to another licensed FFL, which must perform the necessary NICS check on the end buyer. Below are a few quick links. Following that is our ongoing updates and information page, which discusses changes in the firearms and tactical credit card processing industries.

A+ rated and BBB-accredited and operating since 2002, Tasker Payment Gateways LLC helps FFL dealers and tactical website owners with payment gateways, merchant account recommendations, and payment processing integrations. You can read our Better Business Bureau reviews or our TrustPilot reviews to learn what our clients are saying. Additionally, you can read our About Us page to learn more about Tasker Payment Gateways LLC.

Quick links:

FFL e-commerce credit card processing: https://taskerpaymentgateways.com/ffl-dealers/
Tactical e-commerce credit card processing: https://taskerpaymentgateways.com/accepting-payments-for-online-weapon-sales/

Quick links to what's on this page: Hide table of contents
1 06-21-2025: Visa’s MCC 5723 Update: How New State Laws Impact FFL Dealers
1.1 How State Laws in CA, NY, and CO Affect FFL Dealers
1.2 MCC Code Impact on Out-of-State FFL Sales
2 4-19-2023: ATF “Frame and Receiver Rule” adds extra scrutiny but not harming online FFL credit card processing approvals
2.1 What changed in terms of frames and receivers
2.2 How does the Frame and Recvier Rule impact FFL payment gateways and firearms merchant accounts?

06-21-2025: Visa’s MCC 5723 Update: How New State Laws Impact FFL Dealers

A significant change in payment processing is underway, affecting federally licensed firearms dealers. After years of debate, the major credit card networks are now implementing a specific Merchant Category Code (MCC) for firearm and ammunition retailers: MCC 5723. [1]

This code was approved by the International Organization for Standardization (ISO) in 2022, but its rollout was paused due to political and legal challenges. [2] However, new state-level legislation has forced the issue, creating a complex compliance landscape for FFL dealers, especially those in California, New York, and Colorado.

An MCC is a four-digit number used by payment networks like Visa to classify a business by the type of goods or services it provides. [3] Previously, most firearm stores were classified under broader categories like “Sporting Goods Stores” or “General Merchandise.” [4]

The new MCC 5723 is specific to businesses whose primary sales are firearms and ammunition. [5] Proponents argue this code will help financial institutions identify suspicious purchasing patterns and aid law enforcement, while opponents raise concerns about financial privacy and the potential for discrimination against legal businesses. [4][6]

How State Laws in CA, NY, and CO Affect FFL Dealers

While several states have passed laws to prohibit the use of this specific MCC, California, New York, and Colorado have moved in the opposite direction by mandating it. [7] This creates a patchwork of regulations that directly impact how FFL dealers can process credit card transactions.

  • California: A law known as AB 1594 requires payment processors to assign MCC 5723 to all California-licensed firearms and ammunition dealers by May 1, 2025. [3][5] The law defines a “firearms merchant” as any business licensed in California where the majority of sales are from firearms, ammo, or accessories. [7] Acquirers who fail to assign the correct code face a civil penalty of $10,000 for each violation. [5] This law applies to any merchant licensed to sell in the state, including online retailers. [7]
  • New York: Similar to California, New York passed legislation requiring the use of the firearm-specific MCC. [6] The law mandates that by May 1, 2025, processors must assign the code to any business defined as a “dealer of firearms” or “dealer of ammunition” under New York law. [6][7] Governor Kathy Hochul recently signed an update to strengthen the law, ensuring it captures retailers whose bulk sales come from firearms, ammunition, and related accessories. [8][9]
  • Colorado: Colorado’s law (SB24-066) also mandates the use of the new MCC for gun retailers. [10][11] It requires payment processors to assign the code to firearms merchants to which they provide services. [10] Unlike the laws in California and New York, Colorado’s bill is currently limited in scope to merchants that are physically located within the state. [7]

MCC Code Impact on Out-of-State FFL Sales

The conflicting state laws create significant legal uncertainty for e-commerce FFL dealers. [7] A major challenge arises when an FFL dealer is physically located in a state that prohibits the use of MCC 5723 but sells online to a customer in a state like California that mandates it. [7]

Under federal law, the sale of a long gun to a resident of another state is permissible, provided the transaction fully complies with the laws of both the buyer’s and the seller’s states. [12] The new MCC laws add another layer to this rule. An online FFL dealer in a state like Texas, which prohibits distinguishing firearm retailers from general sporting goods stores, may be in a difficult position when processing a credit card payment for a customer in California. [7] The payment processor is caught between one state law that forbids using the code and another that requires it.

For now, FFL dealers must be acutely aware of these regulations. The code itself does not transmit data on specific items purchased (SKU-level data), but it does identify the merchant as a firearms dealer. [13][14] This classification could increase the business’s risk profile with acquiring banks, potentially affecting merchant account approvals and terms. [5] As these laws take full effect, FFL dealers must maintain open communication with their payment gateway providers to ensure compliance and navigate this evolving regulatory environment.

Need help accepting credit cards for your online FFL business? Contact us anytime for a payment gateway or merchant account recommendation.

*We are not attorneys. You MUST seek qualified legal advice before engaging in any regulated commerce, especially FFL transactions.

Sources:

4-19-2023: ATF “Frame and Receiver Rule” adds extra scrutiny but not harming online FFL credit card processing approvals

On March 21st of this year, the ATF issued an advisory letter about last year’s rules updates on “readily convertible weapons.”

In April 2022, the Department of Justice issued a final rule that they say “modernizes the definition of a firearm.” This rule states that partially complete frames or receivers that are “readily” convertible to firearms are subject to the same regulations as firearms made by licensed manufacturers. This means that anyone selling these items and kits must be licensed to sell firearms (FFL) and comply with all of the requirements of the Gun Control Act, including serialization and background checks.

What changed in terms of frames and receivers

Recently, the Bureau of Alcohol, Tobacco, Firearms and Explosives issued a public safety advisory to the firearms industry and the public, highlighting the importance of compliance with the new rule. In addition, the advisory warns that ATF will prioritize investigations involving deliberate efforts to violate the provisions of the Gun Control Act regulating the manufacture and sale of firearm frames and receivers.

Senior Legal Fellow with the Heritage Foundation, Amy Swearer, wrote an extensive piece on last year’s changes – to which the AFT’s new advisory letter refers. Although the subject matter diverges from the subjects covered in this FFL payment processing blog, it’s worth checking out.

How does the Frame and Recvier Rule impact FFL payment gateways and firearms merchant accounts?

As an online payment gateway provider for FFL dealers, we’re happy to help FFL dealers accept credit card payments. However, some of the processes have tightened a bit. For example – an FFL is generally required for any online merchant selling firearms parts – although not all accessories – even if certain firearms components do not require an FFL to sell or manufacture. Additionally, online payment processing for ammunition sellers is unchanged, and unless you are a manufacturer, an FFL is often not required.

Have questions about accepting credit card payments for FFL transfers or tactical items online? Contact us for free friendly advice 

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