Billing is calculated per account, per day. If a student account is active for 45 out of 90 days in a term, it costs 500 naira, not the full 1,000 naira. You are only charged for paid accounts above your free allocation of 1 admin, 2 teachers, and 6 students.
You can move back to the free tier whenever you want. Because billing is based on account-days, you are only charged for the days each paid account was actually active, right up to the point you downgrade. There is no lock-in and no early-exit penalty. When you downgrade, your school keeps 1 admin, 2 teachers, and 6 students active (you choose which), and any accounts beyond that free allocation are paused, not deleted. Their data is preserved and they reactivate the moment you upgrade again.
The free tier is private only. If your school was public, it switches to private automatically while on the free tier, and your previous visibility setting is restored when you resume a paid plan.