Why Users Prefer Prepaid Services Over Postpaid In India?

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Last year, a survey conducted by Nielsen pointed out that 97% of the Indian youth were using pre-paid mobile connections till the end of 2010. The situation is almost the same, majority of users in India are still using prepaid services despite of increasing number of smartphone and Tablets in the market. Finally, I have noticed that there are numbers of factors such as ease of acquisition, economic factors , freedom, flexibility and ‘monitoring and control’ that are determining the use of prepaid cards in the country.

Basically in India, mobile users (having very tight budget or having unstable income especially students) prefer prepaid connections. Prepaid vendors are offering simple and flexible recharging method to users (as per the users requirement and what they want) lure users most. In addition to these, there are lots of different ways to recharge prepaid services via net banking or online portals.

But mobile users having medium to high mobile phone usages, I will suggest them to use post paid connection. If you use more than 30 minutes of outgoing calls in a day, then use of prepaid service is costlier for you. This case, postpaid would be a better option than prepaid.  Unlike prepaid, outgoing won’t be terminated once if you reach to maximal limit in the case of postpaid. I think, the postpaid connection is an advantage for those having extremely high mobile phone usages and those are not worry to pay massive bill in every month .


Now-a-days, many of mid-market mobile phone users demand service like broadband data, media content and other value added services. In India, numbers of mobile users (those want voice top-up) are shrinking day-over-day. At present, a significant number of mobile users are searching for comprehensive packages.

Just a few days before, I believed that the prepaid connection is a trend of emerging markets like India, where users prefer budget packages, but now, users of some matured markets including the U.S. are also wiling to shift from postpaid to prepaid connection due to economic hardship and less committed to monthly bill. In May of this year, it was the first time in the U.S. that seven major mobile operators together reported a loss of about 52,000 postpaid subscribers from Q4 of 2011 to Q1 of 2012.

Prepaid SIM cards with initial credit can easily bought off the shelf due to ease of availability. On the contrary, mobile users need to cross a chain of procedures such as document submission, billing statement and personal identification proof  when they apply for postpaid services . The whole process takes more time compare to prepaid application process. Sometimes legal permission, such as person under 18 years of age can not apply for any contracts, also put interruption ; it means student under 18 years of age could not apply for postpaid connection.

Do you know the best reason why consumers prefer prepaid card? They prefer prepaid card due to better control of mobile usages. In the case of postpaid plans, users have fixed monthly bills, allow users limited services depending on plan. The risk for postpaid plan is, if you unintentionally exceed the limit then there is a probability to pay more than expected. If you are unsatisfied with your present service operators, then you can easily switch to other network anytime in the case of prepaid connection, but it’s not possible for postpaid users.



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