<P> (4) A note which is, or on the face of it purports to be, both made and payable within the British Islands is an inland note . Any other note is a foreign note . </P> <P> Historically, promissory notes have acted as a form of privately issued currency . Flying cash or feiqian was a promissory note used during the Tang dynasty (618--907). Flying cash was regularly used by Chinese tea merchants, and could be exchanged for hard currency at provincial capitals . The Chinese concept of promissory notes was introduced by Marco Polo to Europe . According to tradition, in 1325 a promissory note was signed in Milan . However, according to a travelogue of a visit to Prague in 960 by Ibrahim ibn Yaqub, small pieces of cloth were used as a means of trade, with these cloths having a set exchange rate versus silver . There is evidence of promissory notes being issued in 1384 between Genoa and Barcelona, although the letters themselves are lost . The same happens for the ones issued in Valencia in 1371 by Bernat de Codinachs for Manuel d'Entença, a merchant from Huesca (then part of the Crown of Aragon), amounting a total of 100 florins . In all these cases, the promissory notes were used as a rudimentary system of paper money, for the amounts issued could not be easily transported in metal coins between the cities involved . Ginaldo Giovanni Battista Strozzi issued an early form of promissory note in Medina del Campo (Spain), against the city of Besançon in 1553 . However, there exists notice of promissory notes being in used in Mediterranean commerce well before that date . </P> <P> Promissory notes differ from IOUs in that they contain a specific promise to pay along with the steps and timeline for repayment as well as consequences if repayment fails . IOUs only acknowledge that a debt exists . In common speech, other terms, such as "loan", "loan agreement", and "loan contract" may be used interchangeably with "promissory note" but a loan agreement or contract will typically be more detailed than a promissory note . </P> <P> A promissory note is very similar to a loan . Each is a legally binding contract to unconditionally repay a specified amount within a defined time frame . However, a promissory note is generally less detailed and rigid than a loan contract . For one thing, loan agreements often require repayment in installments, while promissory notes typically do not . Furthermore, a loan agreement usually includes the terms for recourse in the case of default, such as establishing the right to foreclose, while a promissory note does not . Also, while a loan agreement requires signatures from both the borrower and the lender, a promissory note only requires the signature of the borrower . </P>

What's the difference between a loan agreement and a promissory note