Subscription Billing Cycles

What is a billing cycle? 

A billing cycle is the set interval of time between a customer’s recurring invoice dates. It defines when a subscriber gets charged and how long they get access to your service before their next renewal. For instance, if a user signs up on March 1st for a monthly plan, their billing cycle resets on the first day of every month.

Common types of subscription billing cycles 

Subscription platforms usually offer a few standard cadence options depending on their product and customer preferences.

Monthly subscription cycles

Monthly cycles charge users every month, which lowers the barrier to entry and gives customers maximum flexibility.

Annual subscription cycles

Annual cycles charge users once a year, which locks in upfront cash flow and drives higher long term retention.

Usage based subscription cycles

Usage based cycles charge customers on specific calendar dates or when they cross certain usage thresholds.