Mobile network providers want payment for SIM (Subscriber Identity Module) cards they provide, in one way or another. We talked about the reasons some SIM cards are free, and explained that nothing is truly gratis. The carrier may waive the upfront cost for obtaining the SIM and its optional delivery to your doorstep. However, they can expect you to pay at least a nominal fee to activate it. That would let you start using regular services such as calling, texting, accessing mobile data, and more. Others want to keep things predictable and charge you a small fee for the SIM card itself. That brings us to the answer to the question, “what is a paid SIM card?”
Definition of a paid SIM card
Paid SIM card represents any SIM card that is exchanged for a monetary or trade reward. With that in mind, that applies to SIM cards mobile network providers sell to users, whether individually, without obligations or expectations, or as part of a payment plan. The method of delivery and payment is irrelevant. Some carriers demand users visit their stores to pick up their SIM cards. Others only sell online, through an online store, or use resellers, such as grocery stores, supermarkets, and airports.
They may accept cash, credit or debit cards, and soon, cryptocurrency payments on the blockchain via contracts (see our virtual SIM card guide). In rare cases, carriers offer free SIMs but demand you complete certain steps (mostly provide personal information they can use) or recruit others. Though not a financial payment, it’s still not a “free” product. It’s debatable whether that’s a “paid” SIM, but it illustrates our point. The product doesn’t need to have a clear, direct price to be a paid SIM, but it frequently is.
Note. Paying for a SIM technically applies to companies that manufacture it and sell it to carriers (read: how much does a SIM card cost?). However, since this procedure is irrelevant to users, we won’t mention it.
1. Prepaid SIMs are an example of paid SIM card
We already studied prepaid SIM cards and explained the way they work. Though the differences between prepaid and postpaid SIMs should become clear shortly, we’ll also explain the way postpaid ones function below. In short, prepaid SIMs, the most common representatives of paid SIMs, come with no credit from the get-go. Thus, they need to be preloaded or recharged with credit before customers can use them for mobile services.
That requires money, paid at the store, online (carrier website, third-party supported online recharge sites, likely blockchain soon), or other methods. Credit can be consumed to activate a specific, often time-limited payment plan. It may also be used gradually, as a tariff when users call, text, or use mobile data at local, international, roaming, or custom rates. For our topic, we need to understand that carriers offer paid prepaid SIM cards in two ways:
1. Charging a flat price for the SIM card
Many carriers sell their SIM cards for a flat fee, often before $3 and $30, depending on the country. Therefore, they impose little to no conditions on users, since they can profit slightly or recoup their costs even if users never activate their SIM card and spend a penny on credits. Some offer discounts on the SIM if customers recharge a SIM on the spot or within a certain period.
Depending on their business plan, they may offer this option alongside the one below. That helps them accommodate as big an audience as possible. Some mobile network providers avoid charging a SIM card replacement when it’s an upgrade, e.g., from 3G to 4G or 5G. In contrast, they do so for lost or stolen SIMs. Others avoid charging anything or require payment for them all.
2. Demanding payment for consequent SIM usage
Another popular method of offering a paid SIM card involves “waiving” a fee for the SIM, but requiring users to perform a certain action afterward. For instance, they may demand that a user pay an activation or registration fee. Customers may also need to recharge a minimum amount or sign up for a plan with weekly or monthly benefits at least once. Unsurprisingly, all these actions are priced cleverly. They cover the cost of the SIM card manufacturing, modification, and optional shipping to users’ addresses.
They frequently configure an expiration date of roughly 180 days to 6 months. That motivates users into recharging SIMs, so they don’t lose them and need to buy a new SIM. Carriers are undoubtedly ready to take the loss of a small percentage of unused SIMs as expected business costs. They may also accept unpaid but beneficial activities such as signing up for their apps, registering accounts, and encouraging users to visit newly opened stores or reseller shops.
2. Pay as you go SIM cards require credits
Pay-as-you-go SIM cards are similar to prepaid ones in many ways and have the same payment models. However, they carry far fewer contractual obligations or demands for certain plans or sign-ups. Therefore, carriers usually opt for the first method, a flat fee. That gives users the freedom to do whatever they wish. The carrier gets to recoup the costs of manufacturing and delivery and perhaps profit from those that never activate a bundle. Additionally, they impose a shorter expiration date to force users to top up or purchase a new, cheap SIM card.
3. Postpaid SIMs are rarely paid SIM cards
A postpaid SIM card is rarely paid by definition because carriers willingly provide a SIM card free of charge. After all, they know users are hooked to a payment plan for months, a year, or multiple years. With that in mind, the production costs and the shipping price to customers’ home addresses become negligible compared to the commitment and financial investment users have. In some cases, carriers charge a symbolic fee and reduce the cost of payment plans or shorten the contract duration. Returning users and those needing a replacement SIM may need to pay a nominal price, despite not buying the initial one.