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With a prepaid mobile plan you pay upfront for a set period, commonly 28 or 30 days or a long-expiry period such as 365 days, and when it runs out you recharge or stop. With a postpaid plan you are billed after each month for the plan fee and anything outside it. Prepaid has no bill and no credit check; postpaid usually has larger allowances, more add-ons and the option of paying off a phone.
Neither is cheaper as a rule. Prepaid suits people who want a hard spending limit or use little data; postpaid suits people who want to pay monthly by direct debit, combine several services, or buy a phone on repayments. The same rules against bill shock, the same complaints scheme and the same financial hardship protections apply to both.
By Better Rate Mate Editorial Team · Last reviewed
The table sets out the structural differences. Individual plans vary, so the Critical Information Summary for a specific offer is the final word.
| Prepaid | Postpaid | |
|---|---|---|
| When you pay | Before the period, by recharge | After each month, on a bill |
| Credit check | No | Required for a plan with a minimum term over one month; a credit report check for new customers whose minimum total is over $1,000 |
| ID at sign-up | Required by law before activation | Required as part of the account and credit process |
| Period | Commonly 28 or 30 days; long-expiry options such as 365 days | Monthly, month-to-month or fixed term |
| Unused data | Expires at the end of the period unless the plan rolls over or banks it | Some plans roll over or bank unused data |
| Going over | You cannot owe more than you paid, unless you add credit or top-ups | Excess charges, top-ups or slowed speed, depending on the plan |
| Phone on repayments | Rare; buy the phone outright | Common, over 12, 24 or 36 months |
| Leaving | Stop recharging, or port your number | Port your number; pay any early termination charge or device balance |
Moneysmart describes prepaid as paying for your usage in advance, with credit that expires. The recharge buys an allowance of data, calls and texts for the period; if you do not recharge, the allowance ends, and how long the number stays active after that is set out in the provider's terms. The ACMA points out that prepaid mobiles still have a contract: the terms you accept when you activate.
The recharge period matters more than it looks. A 28-day plan renews 13 times a year, so its yearly cost is 13 times the recharge price, not 12. Long-expiry plans (180 or 365 days) suit people who use their phone mainly for calls and texts, such as a second phone or an older relative's phone, because one payment covers the year. Check whether the data on a long-expiry plan is a single pool for the year or a monthly allowance.
A provider cannot activate a prepaid mobile service until it has checked your identity under the Telecommunications (Service Provider — Identity Checks for Prepaid Mobile Carriage Services) Determination 2017. The ACMA says you need to give your name, date of birth and home address. The Determination lists the ways a provider can verify you, including an online check of a government document, an existing postpaid account, a financial transaction, a visual check of your documents in store, and, since 16 December 2025, a government-accredited Digital ID.
These checks exist to stop criminals using anonymous prepaid services, and the ACMA enforces them. It has said it will review the Determination as a priority in 2026. For you, it means having a driver's licence, passport or Medicare card handy when you activate, including for an eSIM bought online.
A postpaid plan bills you after each month for the plan fee plus anything outside the allowance. Before selling a postpaid plan with a minimum term longer than one month, the provider must assess whether you can afford it, and for a new residential customer whose minimum total cost is over $1,000 that includes a check with a credit reporting body. Moneysmart warns that missed repayments or defaults can affect your credit report.
Postpaid plans must send free usage alerts at 50%, 85% and 100% of your included allowance, within 48 hours of each threshold. Most postpaid SIM-only plans are month-to-month, so you can leave with a month's notice or a port. A phone on a plan is different: the ACCC says if the handset is on a longer term than the service, you will have to pay off the handset balance before you leave.
A rough guide, not a rule:
You can move a number either way, including between providers. When you port a number, the new provider validates the request against your old account: under the industry's Mobile Number Portability Code, a matching account number validates a postpaid service, and a matching date of birth validates a prepaid one. Before the port proceeds, the new provider must also confirm you control the number, usually with a one-time code by SMS.
Moving from postpaid to prepaid within the same provider counts as a high-risk transaction under the ACMA's customer identity authentication rules, so expect multi-factor authentication. See switching and keeping your number.
Financial hardship rules apply whether you are prepaid or postpaid. Under the Telecommunications (Financial Hardship) Industry Standard 2024, in force since 29 March 2024, every provider must publish a payment assistance policy, offer at least six kinds of assistance, and treat disconnection as a last resort. If a complaint to your provider is not resolved, the Telecommunications Industry Ombudsman handles it for free.
Prepaid is paid in advance for a set period and has no bill or credit check. Postpaid is billed after each month and may include a credit assessment, larger allowances and phone repayments.
Not as a rule. Compare the yearly cost at the same data allowance: 13 recharges for a 28-day plan, 12 for a monthly plan, one for a 365-day plan, and the price after any introductory discount ends.
Yes. By law a provider must check your identity before activating a prepaid mobile service. The ACMA says you need to give your name, date of birth and home address, and the provider verifies them, for example with a driver's licence, passport or Medicare card check or a Digital ID.
For plans with a minimum term over one month, the provider must assess whether you can afford the service. For new residential customers whose minimum total cost is over $1,000, that includes a check with a credit reporting body.
Yes. The new provider ports your number; for a prepaid service it is validated with your date of birth, and the new provider must confirm you control the number, usually with a one-time code.
A prepaid plan where one recharge lasts a long period, such as 180 or 365 days. They suit light users who mostly call and text. Check whether the data is a single pool for the whole period or a monthly allowance.
