Glossary
Billing and payments terminology explained
What is Balance Billing?
Balance billing converts a plan's base price into a real-dollar spending balance. Usage deducts monetary amounts, and any overage is charged at the end of the billing period.
What is a Billing API?
A billing API is a programmatic interface that lets developers manage subscriptions, report usage, handle plan changes, and automate billing operations from their code.
What is a Billing Cycle?
A billing cycle is the recurring time period between two invoice dates, during which usage is tracked and charges are calculated.
What is Credits-Based Billing?
Credits-based billing gives customers a set number of credits with their subscription. Usage consumes credits, and when they run out, the customer buys more or waits for the next cycle.
What is Dunning?
Dunning is the process of retrying failed subscription payments and communicating with customers to recover revenue before a subscription is cancelled.
What is a Merchant of Record (MoR)?
A Merchant of Record is the legal entity that sells to end customers, handling taxes, compliance, and payments on behalf of software companies.
What is Metered Billing?
Metered billing tracks customer usage during a billing period and charges for overages at the end. Learn how metered billing works and when to use it for your SaaS.
What is Proration in SaaS Billing?
Proration calculates fair charges when a customer changes plans mid-billing cycle, crediting unused time on the old plan and charging for remaining time on the new one.
What is Recurring Billing?
Recurring billing is the automated process of charging customers at regular intervals for ongoing access to a product or service.
What is Seat-Based Pricing?
Seat-based pricing charges customers based on the number of users or seats on their account. Learn how it works, when to use it, and how to implement it.
What is Subscription Billing?
Subscription billing charges customers on a recurring basis for ongoing access to a product, using plans that define pricing, features, and consumption rules.
What is Usage-Based Billing?
Usage-based billing is a pricing model where customers are charged based on their actual consumption of a product or service, rather than a fixed subscription fee.