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The traps of 28-day billing

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Do you check how often you're being billed for your prepaid mobile plan? Amaysim and Boost customers may have noticed that their monthly billing cycle has suddenly been reduced to a 28-day billing period, a move that hasn't made customers particularly happy.

The shorter billing cycle means that telcos will be able to bill you for an additional 13th "month" across a 365-day period, so customers will pay 8%-plus more each year.

While this is a new move for smaller telcos, Joseph Hanlon, editor of WhistleOut, says it's been happening across the big networks for years, with telcos adjusting data inclusions to make up for the bill spike.

"Optus and Telstra have had 28-day billing on a number of their prepaid products for many years," says Hanlon.

"It is always hard to say that a price rise is a good thing for consumers, and moving to 28-day expiry is a sneaky way to raise prices without having to adjust the advertised price. But at the same time, more data was added to all the plans, so while the price went up the included value increased as well."

Don't need the extra data? The good news is you can dump it. Hanlon says the beauty of prepaid is that you're not legally obligated to stay put, so try to find a better deal - there are still a few 30-day billing plans on the market. And do consider the billing cycle length when comparing plans.

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Steph Nash was a staff writer at Money until 2017.
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