Prepaid vs postpaid meters: which actually costs less?
Both meter types are billed on the same tariff, but the arithmetic of rebates, arrears and rounding changes the real number you pay. We run the numbers on a typical Dhaka flat.
Every distribution company in Bangladesh bills prepaid and postpaid customers on the exact same BERC tariff — same slabs, same demand charge, same 5% VAT. The difference in what you actually pay comes from two rebates and from how arrears and fixed charges are collected. We ran the arithmetic on a real 250-unit month so the comparison is concrete rather than theoretical. For the full formula, see our bill calculator.
The two prepaid rebates that postpaid customers miss
- 0.5% prepaid rebate — applied automatically to the pre-VAT subtotal on every prepaid recharge, as an incentive for advance payment.
- 5% early-payment rebate — available to both prepaid and postpaid customers, but far easier to claim on prepaid because the "payment" happens the moment you recharge, which is always before the billing cycle closes. Postpaid customers must actively pay before the due date printed on the bill to qualify, and many miss it simply by paying on the last day or after.
Worked comparison: 250 units, 1 kW sanctioned load, single-phase meter
| Scenario | Rebate applied | Total payable |
|---|---|---|
| Postpaid, paid on time (no rebate) | None | ৳ 2,134.65 |
| Prepaid, recharge only | 0.5% | ৳ 2,123.98 |
| Prepaid, recharged before month closes | 0.5% + 5% | ৳ 2,019.97 |
The gap between the worst case (postpaid, no rebate) and best case (prepaid with early payment) is roughly ৳ 114.68 in this example — small in isolation, but it compounds to a meaningful amount across a year, and it is the closest thing to a "free" saving available on a residential meter.
Where prepaid can feel more expensive — and why it usually isn't
A common complaint is that a prepaid recharge "disappears too fast." This happens because a recharge is not pure energy credit: the meter first deducts any arrears instalment, demand charge for the month, meter rent and VAT, then converts only the remainder into units. A ৳1,000 recharge might yield noticeably fewer units than expected if a demand charge or arrears instalment was due that cycle. This is a timing and presentation difference, not a higher effective price — over a full year the totals converge to what the same consumption would cost postpaid, minus the two rebates above.
Other practical differences
- No estimated billing. Postpaid meters are sometimes billed on an estimate during meter-reader disruptions; prepaid meters cannot be estimated because you only pay for units you have actually drawn.
- No disconnection risk from forgetting a bill. Prepaid simply stops supplying power at zero balance (with a small emergency credit) rather than accumulating a large arrears balance and a reconnection fee.
- Slightly less flexibility during cash-flow-tight months. Postpaid gives you roughly a month of free credit between consumption and payment; prepaid does not.
Takeaways
- Prepaid and postpaid use identical tariffs — the rate per unit never differs.
- Prepaid customers automatically get a 0.5% rebate and find it easier to also claim the 5% early-payment rebate.
- A recharge deducts arrears, demand charge, meter rent and VAT before issuing units, which is why early-month recharges look smaller.
- Over a full year, well-managed postpaid and well-managed prepaid cost within a percent or two of each other.
Related reading: seven mistakes people make with smart prepaid meters and how the demand charge is calculated.
