Difference between a Demand Note and Promissory Note

Demand Note

A Demand Note is a type of  paper money that was first issued between August 1861 and April 1862 during the American Civil War in denominations of 5, 10, and 20 dollars. Demand Notes were the first type of paper money issued by the United States in the sense that they were the first in the series of emissions which has continuously achieved wide circulation down to the present day. The U.S. government placed the Demand Notes into circulation by using them to pay expenses incurred during the Civil War including the salaries of its workers and military personnel.

Promissory Note

A promissory note, referred to as a note payable in accounting, or commonly as just a “note”, is a contract where one party (the maker or issuer) makes an unconditional promise in writing to pay a sum of money to the other (the payee), either at a fixed or determinable future time or on demand of the payee, under specific terms. They differ from IOUs in that they contain a specific promise to pay, rather than simply acknowledging that a debt exists.

Author: gktoday

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