How it works
In a prepaid model the customer buys a balance, and each action is checked against it before it runs. Spend is capped, cash arrives up front, and the main operational task is making top-ups easy so usage is not interrupted.
In a postpaid model usage is metered and invoiced at the end of a period, often with a credit limit. Customers never hit a wall mid-task, which large accounts prefer, but the seller funds the usage until the invoice is paid and must handle failed payments, disputes, and dunning.
Example
Two AI startups each serve $8,000 of usage a month at a $3,000 model cost. The prepaid one has the $8,000 in its account before the usage happens. The postpaid one pays the $3,000 model bill first, invoices on the 1st, and if 5% of invoices fail it is out $400 a month until collected.
Prepaid vs postpaid billing in Cred
cred.diy is built for the prepaid side. Balances are bought through checkout, subscriptions, or x402 payments, deductions fail cleanly when a balance is too low, and saved cards with auto top-up remove most of the interruption that makes customers ask for postpaid terms.
Managing Credits docsRelated terms
Questions
- Which is better for an AI product?
- For self-serve AI products with real per-request costs, prepaid is usually safer because inference is paid for before it runs. Postpaid becomes worth it for enterprise contracts where the customer's credit is known.
- Can a product offer both?
- Yes. Many offer prepaid credits by default and postpaid invoicing to approved accounts. Keep one ledger for both so usage is recorded the same way regardless of how it is paid.
