Glossary term
Proforma Invoice
A preliminary invoice issued before shipment, used for quotations, permits and payment arrangements.
An invoice issued in advance of the sale, setting out the goods, price and terms. It is not a demand for payment.
Buyers use it to arrange a letter of credit, apply for an import permit or obtain foreign exchange approval, so it needs to match what will eventually be shipped and invoiced - a discrepancy between proforma and final invoice can stall a credit.