Building an AI project? Use credit based billing. Here's why

So many new AI projects are charging their users the same way OpenAI charges them: through a metered-billing model.

But there are two critical flaws with this approach:

1. lack of flexibility
2. mismatched billing cycles

Lack of flexibility

With a metered-billing model, you're left with a fairly static pricing model that doesn't offer your users much flexibility to create a pricing model that fits their needs.

Mismatched billing cycles

Let's say your OpenAI bill is charged on the second week of every month and your Stripe billing cycle is at the end of every month.

This leaves you in a position where you don't have money in the bank to pay off the bill.

Not a great position to be in.

The solution? Credit-based billing.

Why does credit-based billing work? It does so by opening up two opportunities:

1. freemium model
2. cash up front

Fremium Model

By giving users initial credits on sign up, this allows them to explore the platform without the barrier of putting in payment information.

Cash up front

By using credit-based billing, it forces users to pay up front for what they would potentially be using, thus allowing you to be able to reliably pay the bill each month.

A great example of credit-based billing is Chatbase's pricing models, which provides a monthly subscription fee for a set amount of credits along with add-ons for more credits. This level of flexibility allows users to create their own unique payment plans while allowing Chatbase to cover for all of their infrastructure fees at the end of the month.

What if you don't know how to implement a credit-based billing system or can't be bothered to build one out?

That's where StripeCredits comes in. It's a Stripe app that allows you to seamlessly integrate a credit-based billing system right into your platform.

So get out there and start charging customers properly!

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