Many postpaid service providers send invoices to collect payment after use.
Prepaid and postpaid are two forms of payment that can be involved in many types of services. It’s more common for people to associate these terms with cell phone plans, but this is just one of many variations of these two types of payment methods. When people pay in advance, they pay in advance to use a service; when they post, they pay after using a service. In the mobile example, many people pay in advance for a specific number of minutes, while in others, people pay after use, although many plans simply charge a monthly fee for unlimited minutes. In the most classic postpaid cellular plan, a bill would arrive at the end of the month, listing the total amount of usage for the month.
Prepaid phone cards are convenient for travelers.
Another example of prepaid and postpaid services involves postage. Most people who mail a letter pay for delivery in advance. They put a stamp on the letter or pay to send a package at the post office or other shipping facilities. Although rarer, sometimes the person receiving the letter pays for the postage after it has already been mailed.
Stays at most motels are postpaid.
Something similar happens when people pay for an item on delivery. Cash on delivery (COD) is a way of postpaying something. Since people don’t always pay when they receive something or pay to redeem an item that was shipped, prepaid is often preferred because the shipping company, whether it’s the courier or another service, loses the costs of shipping the item, since it was sent. without payment.
Netflix® offers subscribers a pay-as-you-go plan to rent movies.
Many types of public services allow people to pay before or after they are used. Payments for things like water, gas and electricity are usually paid after the month they are used. The exact amount paid tends to depend on the exact amount used.
Other utilities may more commonly require payment in advance because costs are not tabulated by usage. Cable, Internet and some phone services can be prepaid with a certain number of dollars per month. Telephone services are sometimes tabulated after the fact because some people pay additional fees for long distance calls. Many carriers have switched to plans where domestic calls are unlimited, but may still charge additional fees for international calls. Still, a prepaid flat-rate fee often makes bookkeeping easier.
Telephone bills are generally calculated on a postpaid basis due to additional charges for long distance and international calls.
There are several other examples of prepaid and postpaid. Housing rent is paid in advance and most landlords expect payment at the beginning of each month for the next month the tenant will occupy the housing. On the other hand, most hotel or motel stays are postpaid. People pay for their stay at checkout and this gives the hotel or motel the opportunity to assess any additional fees, such as phone calls or movie rentals. Regarding movie rentals, some services charge people a fixed prepaid fee each month and offer customers a certain number of DVD rentals or movie downloads for that fee.