Credit-based pricing is a model where customers buy or receive a balance of credits and spend them on actions inside a product, each with a published credit cost. Most AI products include a monthly credit allowance in each subscription plan and sell top-ups when it runs out. It suits products where tasks vary widely in cost, as long as customers can see what a credit buys.
Key takeaways
- Credits are a private currency: you set the exchange rate to dollars and to tasks.
- Most credit systems sit inside a subscription: a monthly allowance plus paid top-ups.
- The backlash in 2025 and 2026 came from opaque rate cards and shrinking allowances, not credits themselves.
- Prepaid credits help cash flow but are usually a liability until customers use them.
Remember arcade tokens?
You handed over $10 at the counter and got a cup of tokens. The racing game cost two tokens. The claw machine cost one. Nobody at the counter had to explain why one game cost more than another. You just spent tokens until the cup was empty, then went back for more (or your parents said no).
That's credit-based pricing. And in 2026 it's how most AI products are sold.
What does credit-based pricing mean?
Credit-based pricing means customers get a balance of credits and spend them on actions inside a product. Every action has a credit cost. A small action costs a little. A big one costs a lot.
Most businesses wrap the credits in a subscription:
- A monthly fee that includes an allowance of credits.
- A rate card showing what each action costs in credits.
- Top-ups customers can buy when they run out.
- Rules for rollover, caps and what happens at zero.
That's the "mix usage with subscription" idea from Chapter Four of The Subscription Playbook, in its 2026 form. And when customers prepay for credit packs, it's the book's minimum commitment model too.
Credit-based pricing examples
| Company | How its credits work |
|---|---|
| Lovable | Pro from $25 a month for 100 credits; "make the button gray" costs 0.50 credits |
| Perplexity | Credits pegged to dollars: 100 credits = $1 |
| HubSpot | Extra credits at $0.01 each; 50 credits buys one resolved support conversation |
| ElevenLabs | Credits roll over for two months, up to three times the monthly quota |
| GitHub Copilot | Moved to dollar-denominated AI Credits on 1 June 2026 |
| A pilates studio | A ten-class pack: ten credits, one per class |
Prices checked 27 October 2026. For live numbers, see the AI Pricing Index.
How do you set the credit cost of an action?
Here's the formula behind a healthy rate card:
Credits per action = Cost to you ÷ (1 − target margin) ÷ value of one credit
A quick worked example (illustrative)
Say an AI transcription feature costs you $0.02 per minute of audio. You want a 75% margin, and one credit is worth $0.01.
$0.02 ÷ 0.25 ÷ $0.01 = 8 credits per minute.
A plan at $29 with 3,000 credits covers about 375 minutes. Check that the margin still holds at your cheapest price per credit, usually your biggest plan.
The Credit Pack Designer does this math for every action and builds the plan ladder for you.
Credit Pack DesignerTurn your cost per action into a credit rate card with healthy margins.Open the free tool →What people get wrong about credits
Credits are not tokens. Tokens are the AI vendor's unit of cost. Credits are your unit of price. Many companies buy tokens and sell credits, and the margin sits in the exchange rate between them.
Credit-based is a type of usage-based pricing. It's usage-based pricing with a translation layer. If customers already think in a natural unit (minutes, messages, pages), you may not need the translation.
Credits can change the deal without changing the price. Change the rate card and the same $20 buys less. That's what caused most of the anger in 2025 and 2026. Figma enforced AI credit limits from 18 March 2026, and some GitHub developers summed up its credit switch as "You will get less, but pay the same price."
Prepaid credits aren't revenue yet. Under AASB 15, cash for unused credits is generally a liability until the credits are used. See revenue recognition for subscriptions.
Build a credit rate card
Enter your cost per action and target margin, and the free Credit Pack Designer turns it into a rate card and plan ladder.
When credit-based pricing is the wrong choice
- Your costs are low and predictable. A flat subscription is simpler.
- One unit captures most of the value. Charge per minute or per message instead.
- You can't publish a clear "what things cost" table. Opaque credits breed distrust.
What to do next
If your actions vary in cost by ten times or more, credits are worth a look. Read the full credit-based pricing guide for 15 rate cards compared and a seven-step design method. Then see what a single AI credit is worth across the market, or how credits fit inside a hybrid pricing model.
Back to the subscription and pricing glossary.
Frequently asked questions
Why do AI companies use credits instead of dollars?
Because one product does jobs with very different costs. A quick edit might cost a fraction of a cent and an agent task several dollars. Credits let a company keep one familiar monthly price, charge heavier actions more, and change its underlying model costs without reprinting every price. Some, like Perplexity, simply peg credits to dollars (100 credits = $1) to keep it clear.
What happens when I run out of credits?
It depends on the product, and you should check before you sign up. Common options are a hard stop, a slower or cheaper mode (Midjourney's unlimited Relax mode), automatic top-ups at a set price, or overage billing. The friendliest systems warn you before you run out and let admins set caps so one user can't drain the account.
Is credit-based pricing the same as prepaid pricing?
Not exactly. Prepaid pricing just means paying before you use. Credit-based pricing adds a conversion layer: your money buys credits, and credits buy actions at rates the vendor sets. Many credit systems are prepaid, but some bill credits in arrears, and pegged credits work almost exactly like prepaid dollars.
Can a small business use credit-based pricing?
Yes, and many already do without calling it that. A pilates studio's ten-class pack, a consultant's bank of prepaid hours and a print shop's print credits are all credit systems. Publish what each credit buys, let unused credits roll over for a sensible period, and give a better rate for bigger packs.
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Robert Coorey, MBA
Robert is the author of The Subscription Playbook and Feed a Starving Crowd and a Director at BPAG Accountants in Sydney. More about Robert.
Sources
- Lovable: pricing (checked 27 Oct 2026)
- Perplexity Help Center: How credits work
- ElevenLabs: pricing (checked 27 Oct 2026)
- Figma: Updates to AI credits in Figma (2026)
- GitHub Blog: GitHub Copilot is moving to usage-based billing (27 Apr 2026)
- Visual Studio Magazine: Devs sound off on usage-based Copilot pricing (27 Apr 2026)
Facts and prices checked 27 October 2026. Spotted something out of date? Tell us.