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Pro-rata?
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Pro-rata?

Hi,
Just curious what peoples thoughts are on pro-rata billing?

We're looking into this due to bandwidth billing etc and wondered if anybody see's this as a bad option when ordering services.

Reece

Comments

  • is that like, pay as you go?

  • perennateperennate Member, Host Rep
    edited January 2014

    @Mark_R in terms of online service billing, it means you pay on a certain date, like the first of each month. The first payment is made proportional to the duration of the service you get (so if you pay on the 15th then you get half the price and service until the first of the next month; if you pay on the 25th then probably you get 1.17 times the price and service until the first of the next next month).

    I don't care either way really. If all the providers used pro rata billing then it'd be easier for me, but they don't, so doesn't matter.

    Thanked by 1Mark_R
  • skagerrakskagerrak Member
    edited January 2014

    @Mark_R said:
    is that like, pay as you go?

    No it means what it stands for pro rata temporis (lat. ) or in portion (engl.) for a specific time.

    Thanked by 1Mark_R
  • I prefer pro rata actually. :)

  • perennateperennate Member, Host Rep

    @budi1413 said:
    I prefer pro rata actually. :)

    Any details?

  • perennate said: Any details?

    What detail? It's just i prefer to pay everything on the first day of every month.

    Thanked by 1perennate
  • perennateperennate Member, Host Rep

    budi1413 said: What detail? It's just i prefer to pay everything on the first day of every month.

    Same, but if only one provider out of 30 do it, does it really make a difference?

  • It can make a lot of difference to the provider. A lot of providers prefer this option as it simplifies billing and accountancy; however some other providers see pro-rata as a problem for short term cash-flow. I'd argue that if one months cash-flow is causing such issue, then maybe the business is not as solid as you thought.

    As for customers, if they understand what it is then great; however many do not and this causes much headache and confusion for them and their provider.

  • perennate said: only one provider out of 30

    That's the problem. Well, host still will do it if we request pro rata billing via ticket. I already do 2-3 times iirc.

    Thanked by 1perennate
  • Awmusic12635Awmusic12635 Member, Host Rep
    edited January 2014

    We do it by default

  • Doesn't bother me any way or the other. Online.net does this.

  • DavidxDavidx Member
    edited January 2014

    I don't care for pro-rata. I usually order services near my payday which is every other week on Friday.

    Thanked by 2perennate Mark_R
  • The benefits of pro-rata billing is that you know when you will be getting the bulk of your payments. It allows for easier suspensions, dealing with unpaid invoices, et cetera. However, the downside is that a lot of people don't like being billed $30 for a $20 VPS because it's after the the 14th of the month. I personally am not a fan and find it to be annoying.

  • ReeceReece Member
    edited January 2014

    Well all of our services we pay for are pro-ratted, the same being for all bandwidth limits also. The main reason would be to combat people using there limit then 2 weeks later being able use it all again when its being reset (By Solus) so in theory they could get double the allocation depending on the time of being ordered.

    I guess it would be 50/50 on the clients preference when paying.

    Thanks for you feedback its helped :)

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