WordValepromissory note
a written promise to pay a stated sum
In more detail
A written promise to pay a specific amount of money to a person or organization on a particular date or on demand.
Examples
- The bank required a promissory note before lending the money.
How to use promissory note
A promissory note is a formal, legally binding financial document used in commercial and personal transactions. It is more formal and specific than a casual IOU, as it typically includes interest rates, maturity dates, and terms of repayment. The term is common in business, law, and banking contexts.
Common phrases
- issue a promissory note
- sign a promissory note
- hold a promissory note
- promissory note payable on demand
- promissory note with interest
Synonyms
negotiable instrument · IOU · written promise · debt obligation · legal instrument
A common mistake
Learners sometimes confuse promissory notes with other financial instruments like checks or bonds; a promissory note is specifically a written promise to pay, not a claim on existing funds or a bond issued by a company or government.
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