Proponents say the move will help detect suspicious increases in gun sales that could be a prelude to a mass shooting.
Visa Inc says it will implement a new merchant category code that will identify transactions at gun stores across the United States.
Saturday’s announcement by the world’s largest payment processor marked a major victory for activists who have argued that categorizing gun sales separately will help better track suspicious firearms purchases that could be a prelude to a mass shooting.
It came a day after the International Organization for Standardization (ISO) approved the creation of the new code.
“Following ISO’s decision to introduce a new merchant category code, Visa will proceed with the next steps while ensuring we protect all legal trade on the Visa network in accordance with our long-standing rules” Visa said in a statement.
Credit card processors use codes to identify sales by industry, such as grocery stores, restaurants, and more. Until Friday, the sale of gun shops was considered “general merchandise”.
The new code would help track where a person spends money, but wouldn’t show which specific items were purchased.
Mastercard Inc has also said it will also implement the new code.
Following ISO’s approval on Friday, Mastercard Inc said that “we are now turning our focus to how it will be implemented by merchants and their banks while continuing to support legal purchases on our network while protecting individual cardholder privacy and decisions”.
American Express Co had previously said that when the ISO develops a new code, the company will work with third-party processors and partners in the implementation.
Gun control proponents had pressured the ISO and banks to adopt this code.
They have cited examples such as the mass shooting at the Pulse Nightclub in Orlando, Florida, where 49 people died after an attacker opened fire in 2016. A week before that attack, the gunman used credit cards to purchase more than $26,000 worth of weapons and ammunition, including purchases from an independent arms dealer.
“When you buy a plane ticket or pay for your groceries, your credit card company has a special code for those retailers. It’s just common sense that we have the same policy for gun and ammunition stores,” said New York City Mayor Eric Adams, a former police captain who blames the proliferation of weapons for the deadly violence in his city.
Two of the largest public pension funds in the US, in California and New York, also filed shareholder resolutions asking payment companies to contribute ideas on the matter.
Gun rights advocates argue, however, that tracking sales at gun stores would unfairly target legal gun purchases, as trade codes only track the type of merchant where the credit or debit card is used, not the items actually purchased.
A sale of a gun safe, worth thousands of dollars and an item considered part of responsible gun ownership, can be viewed as a major purchase at a gun store.
“The [industry’s] The decision to enact a firearms-specific code is nothing more than a capitulation to anti-gun politicians and activists bent on eroding the rights of law-abiding Americans transaction by transaction,” said Lars Dalseide, a spokesperson for the National Rifle Association.
Mass shootings this year, including at a Texas elementary school that killed 19 children and two teachers, have contributed to the long-running US gun control debate.
US President Joe Biden has called on Congress to approve a ban on assault weapons, as well as $37 billion for crime prevention programs, with $13 billion to hire and train another 100,000 police officers over the next five years.