How Do Prepaid Cell Phones Work?


Quick Answer

Prepaid cell phones require the customer to pay for the service in advance, without commitment to a long term contract. When people buy a prepaid cell phone, they have to set up an account that directly links to that particular phone, then add money to that account.

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Full Answer

Prepaid cell phones provide the same essential services as regular phones. However, there are no contract requirements and additional charges for minutes that exceed the plan. Users can make calls and text messages until they run out of minutes. Customers must add money to their account through online payments, by cash or over the phone.

The primary advantage of using prepaid cell phones is that it does not lock the user into a long term plan with a fixed number of minutes every month. In addition, there are no additional costs for users exceeding the limits and breaking the contract. It gives flexibility to the customer to switch to a different plan whenever desired.

The amount topped up, if unused in a month, rolls over to the next month. The prepaid phone charges the user prior to the providing the service. Thus, the user knows exactly the amount being paid for service. Deactivation of the prepaid cell phone occurs as soon as the minutes run out.

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