A billing cycle is a regular period of time between the provision of bills for various products and services.
How long is a billing cycle?
Billing cycles are usually a month long. However, the dates may vary depending on some factors.
One factor is the date of registration for a service. Depending on when a consumer starts a service, the billing cycle is determined. The preference of the customer is another factor. Some services are actually flexible and allow their clients to choose their billing cycle in order to suit their needs.
What products and services have billing cycles?
The average consumer is quite familiar with billing cycles. Practically any service that one subscribes to has a billing cycle. Mobile phone companies have their own billing cycles. Credit card companies have their billing cycle as well. Utility providers are not exempt.
What do billing cycles mean to companies?
The billing cycle is an important part of any institution’s finances. The billing cycle is used to determine details such as applicable interest and the account standing. The company issuing the bills depends on the billing cycle to calculate just how much they are going to charge the customer.
Take for example a credit card company. At the end of one billing cycle, they will take into account the outstanding balance of the customer. They will also look at the purchases made during the billing cycle. They will use this data when computing for applicable charges and then bill the customer. On the customer’s part, knowing the billing cycle helps in planning out one’s finances.