Most of the standard cell phone plans involve a mandatory long-term contract of one or two years and a minimum monthly fee. In return, the users are given approximately 200-300 minutes of talktime every month. If the user exceeds his talktime limit, the network service provider will charge him for each extra minute used. If the user does not use all his minutes in a month, they simply lapse.

These plans often include perks like free weekends and evening calls. It simply means that the calls made during these times do not count towards the users alloted minutes. The user can also add some more options to the plan for a small fee, like free calling to any other cell phone that uses the same service. A high-quality handset is also offered free of cost as part of the plan.

The Pay As You Go Phones plan works quite differently. There is no monthly or contract fee as such. Instead, the user has to buy a phone- card from the market. The user only needs to add a small amount of money every 90 days to his credit to keep his or her account active. The user needs to have his own Pay As You Go Phone or simply Payg mobile phone.

Once the user buys the Payg phone, signing up with the service provider is easy. The user will have to call the service provider. The service provider's representative will ask for the serial number of Payg mobile phone and then will assign it a cell number. The talktime is deducted from the user's available balance. If the balance reaches zero before the expiry of 90 days, the user will have to buy another phone-card to add credit to his account. That is why it is called "Pay-As-You-Go-Phones" plan.

There are many advantages of Payg mobile phone plans. The user need not sign-up a contract with the network service provider. No monthly fees need to be deposited and there is no requirement of any credit card as well. The Pay As You Go Phones plan is especially popular among teenagers as they generally do not have a credit card. The Payg mobile phone plan is also useful for those adults who use their mobile phones minimally and therefore cannot justify the high cost of a standard mobile phone plan.