Question: What is the difference between Non-Prorated Billing and Prorated Billing?
Read the explanation given below to know the difference between the two billing methods:
- Non Prorated Billing: When Non Prorated Billing is set, recurring billing is done on the date of signup. This means that if a customer has signed-up a $5/month plan on May 14th then his next billing will be on June 14th.
- Prorated Billing: Prorated Billing is a common billing method used in hosting industry. When enabled, billing system will charge a complete month and then first recurring will be prorated. Consider the following example:
Hosting Plan: $10/month
Billing Day: 2nd of month
Signup Date: 15 May
New account will be charged $10 for 15 May-15 June. On 15 June user will be charged $5 for 15 June-2 July (prorated) and onward billing will be from 2nd to 2nd each month.