A guide for underwriters at ISOs and Acquirers onboarding MCC 5532 automotive tire merchants, covering risk assessment, fraud signals, and the underwriting questions that matter.
If you're underwriting a tire retailer, MCC 5532 is moderate risk with exposure around installation and service disputes, warranty claims, and fleet accounts. Most transactions are card-present, which keeps fraud lower than online-heavy categories. Here's what to look for.
Key Information
This guide covers automotive tire stores, where card-present service sales meet warranty claims, fleet billing, and installation disputes that drive most of the chargeback exposure.
Typical Business Types
Retail Tire Stores
#1
Shops selling and installing tires for consumers.
Tire and Service Centers
#2
Outlets combining tires with broader automotive service.
Commercial and Fleet Tire Dealers
#3
Dealers serving commercial and fleet customers.
Payment Processing Information
Transaction Types
1
In-Person Service Payment
Card-present payment after installation or service.
2
Fleet and Commercial Billing
Periodic billing for fleet accounts.
3
Phone Payment
Card details taken by phone for authorized work.
4
Warranty and Road Hazard Claims
Charges and credits tied to warranty coverage.
5
Mobile and On-Site Service
Payment for mobile tire installation.
Common Payment Methods
Credit and Debit Cards - Primary method for retail service
Commercial Fleet Cards - Cards with product and purchase controls
Financing Plans - Installment financing for larger purchases
Mobile Payments - Contactless and digital wallets
Cash and Checks - Used for smaller and commercial transactions
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Service Disputes - Customers contesting installation or service charges
Warranty Claim Disputes - Conflicts over road hazard and warranty coverage
Card-Not-Present Fraud - Phone orders using stolen card data
Fleet Card Misuse - Cards used for unauthorized vehicles or products
Friendly Fraud - Buyers disputing genuine service charges
Regulatory Challenges
Tire Disposal Rules - Environmental disposal and recycling requirements
Warranty Disclosure - Clear road hazard and warranty terms
Consumer Protection - Fair pricing and service disclosure
Safety Standards - Installation and inspection requirements
PCI Compliance - Payment card data security
Common Fraud Signals
Service Dispute Pattern
Disputes contesting installation quality or necessity.
Warranty Claim Conflicts
Frequent disputes over road hazard coverage.
Phone Payment Verification Gaps
Card-not-present work authorized without verification.
Example Scenarios and Red Flags
Installation Dispute Chargebacks
Customers disputing service quality or completion.
Warranty Coverage Conflicts
Disputes over what road hazard plans cover.
Phone Payment Fraud
Card-not-present authorizations on stolen cards.
Fleet Card Abuse
Commercial cards used outside account controls.
Friendly Fraud
Buyers disputing genuine service charges.
Common Underwriting Questions
UW Tips Business
Verify business licensing and environmental disposal permits
Confirm the shop is operational and equipped
Check warranty and road hazard plan terms
UW Tips Financial
Assess average service ticket and fleet receivables
Review warranty claim frequency and cost
Examine seasonal demand around weather changes
UW Tips Risk
Evaluate service authorization and documentation
Assess phone payment verification
Review fleet card controls
UW Questions Business
What services do you provide beyond tire sales?
Do you serve fleet and commercial accounts?
What warranty and road hazard plans do you offer?
UW Questions Payments
What share of payment is card-present versus phone?
How are fleet accounts billed and controlled?
Do you offer financing and how is it managed?
UW Questions Fraud
How do you document service authorization and completion?
What verification covers phone payments?
How do you manage fleet card use?
UW Questions Compliance
Do you comply with tire disposal and environmental rules?
How do you disclose warranty terms?
Are PCI assessments current?
UW Questions Chargebacks
What is your chargeback ratio and what reasons dominate?
How do you document service and customer approval?
Do you retain records for representment?
UW Questions Infrastructure
What shop management and POS systems do you use?
How do you integrate service records with payment?
Do you support EMV and contactless?
Ongoing Monitoring
Transaction Monitoring
Track service and installation disputes
Monitor warranty claim conflicts
Flag phone payment fraud patterns
Compliance Checks
Maintain disposal and environmental compliance
Keep warranty disclosures current
Hold PCI assessments current
Security Updates
Use EMV and contactless for service payments
Apply verification on phone transactions
Encrypt and tokenize stored card data
Risk Assessment
Reassess exposure during seasonal demand peaks
Track warranty and service dispute trends
Review fleet controls regularly
Merchant Communication
Help the merchant document service authorization to defend disputes. Share practices for clear warranty terms and phone payment verification. Support fleet account controls and disposal compliance.
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