How Does a Pay-as-You-Go Cell Phone Work?
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What is Pay-as-You-Go?
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A pay-as-you-go cell phone is the phone to get when a user doesn't want a binding contract, credit check or long-term commitment to a phone company. Pay-as-you-go is exactly what is sounds like: payment only for the phone minutes used. There are no commitments or dangers of early termination fees as in conventional one- or two0year phone plans, and no fees for late payment. In short, pay-as-you-go is a way to have a cell phone without the hassle of a contract.
How Do Pay-as-You-Go Phones Work?
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All of the major phone carriers now have some form of pay-as-you-go; the phones are sold through retailers like Target and Wal-mart, or through branded stores. Pay-as-you-go service is isolated to certain phone models, though the models are usually comparable in features to normal contract phones.
Some versions of pay-as-you-go allow for Internet usage and browsing, while others don't. Since data usage often eats up minutes, it's not a very productive use of phone-card time. However, certain carriers do offer data for an additional monthly fee. This option may be best for pre-billed phone agreements rather than card plans.
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How Do You Pay for Minutes?
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Minutes are purchased in packs, depending on how much the user pays. Each minute has a set rate, usually between 10 and 25 cents per unit. As the phone runs out, the user receives text messages warning him to recharge the phone. At the end of the card, service stops. Card phones don't offer the major perk of free night and minutes, but, like AT & T, may have free service to other network users.
Other plans resemble a normal phone contract, but require upfront payment each month before minutes recharge. Those customers enjoy the features of contract service without such, receiving free nights and minutes and automatic payment through debit or credit card, or by bank account. This may be the easiest pay-as-you-go plan for those most used to contracts.
What Companies Offer Pay-as-You-Go?
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The major carriers all have plans. Companies offering both card-recharge and prepay accounts include T-Mobile and AT&T. Some customers choose smaller companies like Virgin Mobile or Boost; however, these services are most effective in big cities areas because of coverage limitations.
Depending on phone usage and range necessity, there is a prepay option that is suitable for everyone. These phones are terrific for business use, talkative teenagers and budget-conscious cell customers. However, the best monetary value comes with a long-term contract.
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- Photo Credit 2006 Milica Sekulic / Creative Commons
