MCC Codes
1740

Masonry, Stonework, Tile Setting, and Plastering Contractors

A guide for underwriters at ISOs and Acquirers onboarding MCC 1740 masonry and tile contractor merchants, covering risk assessment, fraud signals, and the underwriting questions that matter.
View All MCCs

Using this for underwriting? Run the numbers with our Onboarding Calculator.

Table of Contents
Overview
Business Types
Payment Processing Info
Key Risks & Concerns
Common Fraud Signals
Example Scenarios
Common Questions
Ongoing Monitoring
Useful Sources

Underwriting Cheat Sheet

If you're underwriting a masonry and tile contractor, MCC 1740 concentrates risk around large material-heavy deposits for brick, stone, and tile, progress billing across multi-week jobs, and disputes over finish quality, grout lines, and color matching. Material price swings and subcontracted crews add cancellation and completion exposure. Here's what to look for.

Key Information

This guide covers masonry, stonework, tile setting, and plastering contractors, where material-heavy deposits, progress billing, and finish-quality disputes drive fraud and chargeback exposure.

Typical Business Types

Brick and Block Masons

#1
Contractors building walls, foundations, and structural masonry.

Tile and Stone Setters

#2
Installers of floor, wall, and countertop tile and natural stone.

Plastering and Stucco Contractors

#3
Crews applying interior plaster and exterior stucco finishes.

Payment Processing Information

Transaction Types

1

Project Deposit

Upfront card payment covering brick, stone, or tile materials.
2

Progress Billing

Scheduled card payments tied to job milestones.
3

Final Completion Payment

Balance charged after walkthrough and finish approval.
4

Material Surcharge Billing

Added charges when stone or tile prices rise mid-job.
5

Repair or Tuckpointing Call

Card payment for smaller mortar repair or repointing work.

Common Payment Methods

Credit and Debit Cards - Used for deposits, progress draws, and repairs
ACH and Bank Transfer - Common for larger commercial draws
Checks - Still frequent on residential and contract jobs
Buy Now Pay Later - Financing offered on larger residential installs
Recurring Draws - Milestone billing across multi-week projects

Underwriting MCC

1740

at scale?

See how Gratify automates the risk assessment and gets applications decision-ready in minutes.
Get a 15min Demo

Key Risks & Concerns

Fraud Risks

  • Deposit and Disappear - Taking material deposits without performing work
  • Progress Billing Disputes - Chargebacks claiming milestones were not met
  • Finish Quality Claims - Disputes over grout, color match, or cracking
  • Material Surcharge Disputes - Pushback on price-driven added charges
  • Unlicensed Contractor Fraud - Operating without required masonry licensing

Regulatory Challenges

  • State Contractor Licensing - Licensing and bonding for masonry trades
  • Mechanics Lien Rules - Lien rights and notice requirements on projects
  • Building Codes and Permits - Structural and inspection requirements
  • OSHA Construction Standards - Silica, scaffolding, and site safety rules
  • Home Improvement Contract Laws - Deposit caps and cancellation rights

Common Fraud Signals

Large Deposits, Slow Completion

Big upfront charges with long gaps before further billing.

Milestone Dispute Clusters

Repeated chargebacks tied to progress draws.

Finish Complaint Spikes

Disputes concentrated on grout, color, or cracking.

Example Scenarios and Red Flags

No Verified License or Bond

Masonry licensing cannot be confirmed with the state.

Deposit Exceeds Legal Caps

Upfront amounts above state home improvement limits.

Abandoned Job Disputes

Customers reporting unfinished masonry after deposits.

No Lien Waivers on Draws

Progress billing without lien waiver documentation.

Vague Scope Documentation

Contracts lacking detail on materials and finish standards.

Common Underwriting Questions

UW Tips Business

  1. Verify state contractor licensing and bonding
  2. Confirm physical operations and crew capacity
  3. Check insurance including general liability coverage

UW Tips Financial

  1. Understand material-heavy cost structure and price exposure
  2. Review project sizes and progress billing schedules
  3. Assess the split of residential versus commercial work

UW Tips Risk

  1. Examine deposit caps and cancellation policies
  2. Evaluate scope documentation and finish standards
  3. Review chargeback reasons across draws and completion

UW Questions Business

  1. Are you a licensed and bonded masonry contractor?
  2. Do you self-perform or subcontract your crews?
  3. What insurance coverage do you carry?

UW Questions Payments

  1. How do you structure deposits and progress draws?
  2. How do you handle material price surcharges?
  3. What share of revenue is residential versus commercial?

UW Questions Fraud

  1. How do you document scope and finish standards in contracts?
  2. What stops disputes over completed milestones?
  3. How do you handle grout, color match, and cracking claims?

UW Questions Compliance

  1. Do your deposits comply with state home improvement caps?
  2. How do you handle permits and code inspections?
  3. Do you provide lien waivers on progress payments?

UW Questions Chargebacks

  1. What is your chargeback ratio and what drives it?
  2. How do you document completed milestones and approvals?
  3. How do you resolve finish quality complaints?

UW Questions Infrastructure

  1. Is your billing system integrated with project milestones?
  2. How do you reconcile deposits against material costs?
  3. Do you retain signed contracts and walkthrough records?

Ongoing Monitoring

Transaction Monitoring

  • Watch large deposits with slow follow-on billing
  • Track milestone and completion disputes
  • Flag finish quality complaint clusters

Compliance Checks

  • Keep contractor license and bond current
  • Maintain permit and lien waiver records
  • Stay current on home improvement deposit rules

Security Updates

  • Use card verification on large deposit charges
  • Apply tokenization for stored milestone billing cards
  • Document scope and approvals to defend disputes

Risk Assessment

  • Adjust monitoring during peak building season
  • Address scope ambiguity before it drives disputes
  • Watch material price volatility affecting surcharges

Merchant Communication

Help the contractor write detailed scope and finish standards that hold up in disputes. Share deposit and lien waiver practices aligned with state caps. Support cash flow planning across material price swings and seasonal demand.

Overwhelmed with Applications?

Gratify offers instant merchant application enrichment to get the full picture of your customers in real-time
Learn about the fast way to onboard merchants

Useful Sources

Visa Merchant Data Standards Manual

PCI DSS Quick Reference

OSHA Construction Industry Standards

Level up your Onboarding game with Gratify

Everyday we talk to experts in payments, underwriting and merchant onboarding. They share their insights with us, and we want to share them with you.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Tick Icon
Stay Updated
Tick Icon
1 email per week
Gratify merchant onboarding platform
LinkedIn
Industries
Retail ISO
Wholesale ISO
PayFac
Acquirer
White label BNPL
Product
Statement AnalyzerSmart FormsKYB & KYCUnderwriting AutomationOnboarding AutomationRevenue Assurance
Resources
MCC LookupBlog2026 State of Merchant OnboardingOnboarding CalculatorOnboarding Checklist
Comparison
Gratify vs BallerineGratify vs LegitScriptGratify vs NMI ScanX
Company
About UsContact UsPrivacy PolicyCookie Policy
© 2026 Gratify Payments Inc.