What is the difference between rating and billing.jpg

The difference between rating vs billing is one of those things that everyone thinks they know but if you ask 10 people for definitions, not too many people will be able to explain the disctinction. Let's take a look on what the difference is. 

What is Rating?

Rating refers to the process of translating metering data into invoice items for a customer, based upon the pricing plan they’ve chosen. 

Rating or "rate columns" are often used in telecommunications industry. Take for example a cell phone plan - a product that charges you at the end of the month for the usage you consume. Rating is often used for more advanced pricing. For example, international calls to China, Japan, France or South Africa would have different rates compare to your domestic rates. 




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What is Billing?

Billing is the process of creating an invoice for customers on a recurring basis according to the pricing plan they have selected, their usage during that time period, and any discounts that may apply. 


If you’re a subscription based business, your system should provide a rating engine that can calculate the charges based upon usage data over time. And, in some cases it may need to be configurable as to how the rating calculations are performed. If your rating is not accurate or it doesn’t work, your billing is going to be mess, because it will reflect your rating settings.

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