Pay As You Go Mobile Phones

Pay as you go mobile phones work by a customer paying upfront for a handset and then paying for each minute they spend talking, every text they send and every time they use mobile data in advance and without signing up to a contract. This contrasts with a typical pay monthly mobile contract where customers sign up to a lengthy contract and pay for the handset at the same time as paying for an inclusive allowance of calls, texts and data.

There are two types of pay as you go mobile phone deals: traditional PAYG and bundled PAYG. We cover these in more detail below, but the major principle of pay as you go is simple: you pay upfront rather than on a contract basis.

Pay as you go mobiles are useful for those who don't use a mobile phone very often and so don't want to sign up to a lengthy and potentially expensive contract. Elderly people who may only use a mobile to occasionally call relatives on the same network, for instance, might find pay as you go easier and cheaper than paying for a monthly contract. Basic mobile phones are often available on a pay as you go basis, allowing access to a simple mobile phone with a simple payment strategy.

Anyone who wants to control their mobile spending upfront rather than getting a huge bill at the end of the month might opt for a pay as you go mobile deal. So, people who struggle to manage their money effectively might benefit from PAYG, or a pay as you go mobile might be useful for teenagers who aren't ready to put on their parents' contract plans but still want access to a mobile.

Pay as you go mobiles don't require credit checks, meaning they're a viable option for anyone whose credit history may stop them from signing up to a pay monthly contract.

One of the major benefits of pay as you go mobile deals is that there is no monthly commitment. While you can choose to sign up for recurring bundles, there are some traditional pay as you go options that allow you to pay in advance for what you use - more details on this below.

Pay as you go mobiles allow users to keep track of their spending, avoiding big bills at the end of the month. In addition, they don't require credit checks, so a customer with no UK credit history or a patchy credit record can easily access a mobile.

Unlike pay monthly contract phones, pay as you go mobiles can be purchased by under-18s. This means that teenagers can access mobile services before they're 18 and is a great option for those who may leave home early or spend a lot of time elsewhere.

Pay as you go mobile phones can also be great value, especially if you choose basic phones, refurbished ones or have an old mobile you want to repurpose into a PAYG option for a family member.

The major drawback for customers comparing pay as you go mobile deals is often the upfront cost of the handset. If you're looking for the latest mobile phone from one of the major manufacturers, you may pay upwards of £600 for the handset alone. With some mobile handsets breaking the £1000 barrier, this could be too expensive for many. Remember, too, that the costs of calls, texts and data will be added to this whenever you top-up or apply a bundle to your phone.

If you plan to use your mobile regularly, a pay as you go deal may prove to be too expensive. There's better value within a pay monthly contract, although we've covered the reasons that might not be an option in the section above. However, it's worth being clear about the limitations of your new pay as you go mobile before you buy - ask how much data you would realistically use in a month and whether a pay as you go deal will cover that cheaply enough.

For those choosing pay as you go because they rarely use a mobile but want one just in case, it's worth noting that some operators will deactivate a phone number if the mobile isn't used for a certain period of time. Any credit remaining on the phone at this point will be lost and customers will have to get a new number.

Choosing the right mobile phone network for your needs can be more complex for pay as you go mobiles compared to pay monthly deals. This is mainly due to the differences between traditional PAYG and bundled PAYG, which we cover in more detail below.

Firstly, though, it's important to check which networks have good coverage in the locations you spend a lot of time, whether that's home, work, college or elsewhere. All operators in the UK use one of the four underlying networks to offer their mobile services, so check coverage with EE, O2, Vodafone and Three to check which one works best for you.

After that, it may come down to personal preference (perhaps you've had a good or bad experience with a network before) or simply a recommendation from family or friends. You can search on Choose to find our reviews of the major mobile networks and to find the latest news about how each of them are performing.

The best way to compare pay as you go mobile deals will differ depending on your personal requirements. As we've already mentioned, the first thing to check is that a provider has good coverage in your area. But what else should you check when comparing PAYG mobile deals?

The upfront cost of handsets is likely to be similar from different providers. However, using the Choose comparison service, you can also filter for refurbished handsets, allowing you to get a quality mobile at a lower price.

For customers who don't want a complex handset, there are some excellent bundle deals to be snapped up for lower spec mobile phones. Be mindful when looking at these cheaper phones that they may not be ideal for heavy browsing and multiple apps, but for people who use their mobile more for calling and texting, these cheaper handsets could be the perfect fit.

Traditional pay as you go phones were popular before pay monthly contracts dropped to more widely affordable levels. Customers purchased a handset upfront and then bought a voucher to top-up their credit. Topping up became easier with debit cards and other forms of mobile top-up options, but the basic principle of traditional pay as you go is that you put a set amount of credit on your phone which is then used up gradually by your calls, texts and data usage.

The costs of using traditional pay as you go vary from operator to operator, and it's true there aren't as many networks offering this type of pay as you go option anymore. Rates per minute of talk time can range from 1p up to 35p or more, with texts costing anything from 1p to 20p. Data can be the most expensive element of traditional pay as you go deals, with some providers offering 1p per MB while others go up to 5p per MB or more. Some networks don't allow customers to purchase data on such PAYG deals.

PAYG bundles work slightly differently and have become far more common among networks. Instead of just paying for a set amount of credit in advance, customers choose a bundle of minutes, texts and data which generally last for a month. After that, they'll need to buy another bundle to continue using the phone - there is usually no credit left on an account once the bundle expires.

Bundles come in varied amounts, though £10 options are popular. There can be a huge difference between bundles from different networks, so it's worth comparing these carefully when you're looking at pay as you go bundle options.

It's possible to switch to another network to take advantage of a pay as you go deal and still keep your phone number. You'll need a porting authorisation code (PAC) from your current provider, but this is easy to obtain - simply text "PAC" to 65075. If you want a new mobile number, text "STAC" to 75075. Once you get your code, you give this to your new mobile provider.

Switching from contract to pay as you go should be done at the end of a contract to limit the fees you may be charged in the form of early exit fees.

The process for giving your PAC to your new provider varies from network to network, but the switch will take place the next working day according to Ofcom's guidance.

Topping up a traditional pay as you go mobile can be done in a variety of ways. Some supermarkets and other shops still sell vouchers to enable customers to top up in that way. Other options include calling to top up or sending a text message. Some cash machines also allow customers to top up there.

Whether you're using traditional pay as you go or purchasing a bundle, there should be several top-up options available to you. Check before signing up that these options are suitable for your needs.

Some customers prefer to take a pay as you go phone abroad with them, whether they have a pay monthly contract with a network or not. Be careful when you compare PAYG roaming options, however, as some charges are astronomically high and could lead to your credit running out almost immediately.

Some pay as you go operators have deals with operators in other countries, allowing roaming at decent rates in those locations. So, check the small print on a provider's website if this is a primary reason for choosing PAYG - if a location you visit regularly is covered, using your pay as you go mobile over there could prove to be economical.