There is always a buzz when we talk about prepaid and postpaid connection. As the name suggests, prepaid refers to the payment made in advance and services are availed afterward. On the other hand, the postpaid connection is one in which you first avail the services and thereafter pay the price for it.
Professionals, employees, and people belonging to business class prefer postpaid over prepaid while youngsters believe prepaid is better than postpaid. So the fight between these two SIM (Subscriber Identity Module) is never ending.
People are often confused between these two, as to which connection is better than the other. Just have a glance at this article, to know the differences between prepaid and postpaid connection.
Content: Prepaid Vs Postpaid Connection
|Basis for Comparison||Prepaid||Postpaid|
|Meaning||Payment beforehand.||Subsequent payment.|
|Cost of plans||Less||Comparatively high|
|Charged||On real time basis||At the end of the month|
|Credit history||No requirement||Utmost important|
|Bill||Not provided||Detailed bill is provided to the customer.|
Definition of Prepaid connection
Prepaid stands for prepayment, is a mobile connection for which you pay upfront for the services like calling, messaging, data usage and any other services, etc. In this plan, the customer purchases the credit before using the services.
The SIM requires that you first recharge for availing a particular service and then you can use it till the amount in your credit is nil or the term for which the recharge is done is expired (whichever is earlier). As soon as the available credit limit is over, you cannot use the services anymore. You need to top up again for availing services. Although there is some payment mechanism available today through which the customers can easily recharge credit at any time.
Definition of Postpaid connection
Postpaid refers to payment after use, is a SIM card in which you can make subsequent payment for the service usage. As per mobile connection, the customer can use the services of the mobile network and then he is charged at the end of the month or the billing cycle, either as per their contract with the service provider or for all the services availed by them during the month.
Normally, the customer is charged as per his contract with the service provider, which specifies the limit for browsing, texting, calling minutes. If the usage is less than or equal to the limit specified, the user is charged at a flat rate. Any usage over and above is subject to extra charges. It can also be said that the user can enjoy unlimited credit.
The credit history of the customer is very important in postpaid connection as it forms a base on which the service provider can rely upon, that whether the customer is capable of paying the outstanding bill amount or not. The contractual agreement specifies that the service provider can take legal action against the customer for non-payment of the bill.
Key Differences Between Prepaid and Postpaid Connection
The major differences between prepaid and postpaid connection are described in the following points:
- Prepaid refers to the scheme in which you buy credit in advance before availing services. Postpaid is defined as a scheme in which the customers are billed at the end of the month for the services availed by them.
- Plans of postpaid SIM costs higher than prepaid SIM.
- Prepaid plans are inflexible whereas postpaid plans are flexible in nature.
- Prepaid customers are charged on a real-time basis for all the services availed by them. On the other hand, postpaid customers are charged on a monthly basis.
- The credit history of the customer is of extreme importance in the case of the postpaid customer because it is the only basis on which the service provider can rely upon regarding the payment of the outstanding amount. However, this is not so in the case of prepaid customers.
- Prepaid customers do not get any bill in the month end, as they pay in advance for the service availed by them. Conversely, service providers send a detailed bill to the postpaid customers for the services availed by them during the month.
Historically, only postpaid SIM existed at the beginning, which can be availed by those customers only, who possess a good credit rating. But with the emergence of prepaid SIM, any segment of customers can avail the service. It cannot be said that which payment system is more popular among people. However, a customer with high usage may go for postpaid connection, and the customers who require low usage may opt prepaid connection.