Credit note Definition
A credit note is a monetary instrument issued by a seller that allows a buyer to purchase any item or service from that seller on a future date.
Credit notes may be issued by a seller as a goodwill gesture to a buyer who wishes to return previously purchased merchandize (instead of cash repayment) in circumstances where the original sales agreement did not include an explicit refund policy for returned items. In such circumstances, a credit note of value equal to the price of the returned item is usually issued allowing the buyer to exchange his purchase for other items available with the seller.