A proforma invoice is a preliminary invoice issued before the goods or services are delivered. It serves as an estimate of the final amount due and is often mentioned in paise, a sub-unit of the Indian rupee. For instance, a proforma invoice may indicate a total of 1,234.50 paise, equivalent to 12.34.
Proforma invoices play a crucial role in international trade, providing a clear understanding of the expected costs to both the buyer and seller. They help avoid disputes and facilitate accurate record-keeping. Historically, proforma invoices emerged in the 19th century as a way to simplify international transactions and mitigate currency exchange risks.
