You have the flexibility to define the nature of charges associated with your products or services. Specifically, you can determine whether a charge is metered or recurring. Understanding the distinction between these two types of charges is crucial for effectively managing your billing processes. In this documentation, we will delve into the differences between metered and recurring charges and their implications within the Lago system.

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Metered charges

When you create a metered billable metric in Lago by setting the recurring parameter to false, an important behavior comes into play. At the end of each billing period, the accumulated number of units associated with the metric is automatically reset to 0. This means that the counting or measuring of units starts fresh with each new billing cycle. This is ideal for billing components with results that are not persisted billing periods over billing periods.In the API tab beside, consider the example of a Storage billing unit. If you need to track the Gigabytes stored during a month, it’s important to note that this value should be reset to 0 at the beginning of each new month.

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Recurring charges

When you create a recurring billable metric in Lago with the recurring parameter set to true, an important behavior comes into effect. At the end of each billing period, the accumulated number of units calculated from the previous billing period is carried forward to the next billing period.This means that the counting or measurement of units starts based on the last recorded value from the previous billing cycle. This behavior is particularly useful for billing components or services where the results need to persist from one billing period to another.In the API tab, let’s consider the example of a Seats billing unit. If you need to track the number of active seats, it’s crucial to note that this value should persist month over month. The recurring billing behavior ensures that the count of active seats is maintained and carried forward to subsequent billing periods, providing accurate and continuous tracking of your subscription seats.