Billing cycle definition

A billing cycle is the period of time between one billing statement by a business to its customers and the next statement. One calendar month is a common billing cycle for most business relationships, whether between businesses or between a business and a consumer.

While the typical billing cycle begins on the first of each month, it is quite common for a billing cycle to begin at any time of the month. In fact, often a business that sells to consumers will allow its customers to choose a billing cycle to help with their budgeting and cash management.

A regular billing cycle is useful for a business to forecast and manage cash flow and is important to consumers so they can predict and manage their payments.