Billing Anchor
A billing anchor is the fixed point in time that determines a customer's recurring billing cycle. It's typically set when a customer first subscribes and affects when charges occur and how prorations are calculated.
Common anchor types:
- Calendar month (1st of each month)
- Subscription anniversary (day customer signed up)
- Custom date (customer-specified day)
Examples
- Calendar anchor
- Customer signs up January 15th
- First bill: Prorated January 15-31
- Future bills: 1st of each month
- Proration happens on first bill only
- Anniversary anchor
- Customer signs up January 15th
- First bill: Full period charge
- Future bills: 15th of each month
- No initial proration needed
- Custom anchor
- Customer requests 20th of month
- First bill: Prorated to next 20th
- Future bills: 20th of each month
- Helps align with customer's accounting