servicecredits

Service credits are a form of billing entitlement issued by service providers to customers. They take the form of a credit or discount that offsets future charges rather than a cash refund.

Used mainly in cloud providers, telecoms, software vendors, and managed services, service credits are often linked to service level agreements (SLAs) or promotional programs.

How they work: When a service fails to meet SLA, or as part of a promotional offer, the provider may issue credits. The credit is typically a percentage of the charges incurred during the affected period or a fixed amount. The credits are applied to subsequent invoices or account balances rather than paid out as cash. Eligibility requires filing a claim within a time window; verification by the provider; and adherence to terms and conditions.

Limitations: Credits are not cash and may have expiration dates or usage restrictions. They may be non-transferable and may be subject to minimum spend, geographic limits, or service exclusions.

Examples: Cloud providers commonly publish SLA credits for outages; promotions may give new customers a credit upon signup. Major providers include AWS, Microsoft Azure, and Google Cloud.

See also: Billing credits, SLA credits.