What a proforma invoice is
A proforma invoice is a binding offer dressed as an invoice. It states exactly what you will ship, at what price, on what terms, and for how long that offer stands — before anything is manufactured, shipped or paid for. It is not a fiscal document, it does not create a receivable, and you do not book revenue against it.
It exists because your buyer cannot act without it. To open a letter of credit, their bank needs a document naming the goods, the amount, the currency, the Incoterm and the shipment window. To apply for an import licence or a foreign-currency allocation, their ministry needs the same. In much of the world — Egypt, Nigeria, Algeria, Bangladesh — no proforma means no import approval, which means no order.
The commercial invoice comes later and describes what actually shipped. The proforma describes what you promise to ship. When the two disagree, the buyer's bank refuses the documents, so treat the proforma as the specification that the rest of the shipment must match.
What has to be on it
A number and a date. The buyer's bank quotes your proforma number on the letter of credit, and their customs authority files against it. Without one, there is nothing to reference.
An expiry. Prices move, freight moves, and an offer with no end date is an offer you are still bound by six months later. Banks check the validity date before opening a credit against the document, so state it and mean it.
An Incoterm with a named place. "CIF" is not a term; "CIF Genoa (Incoterms 2020)" is. The rule decides who pays freight and insurance and — more importantly — the point at which risk passes from you to the buyer.
An HS code per line. Customs in the destination country classifies on the code, not on your description, and the duty the buyer will pay depends on it. Get it wrong and your buyer eats an unexpected bill, which becomes your problem on the next order.
The currency, stated explicitly, and bank details only if an advance is genuinely due. A proforma that prints wire instructions when no advance is owed reads as a demand for payment, which is not what this document is.
Proforma vs commercial invoice
They look almost identical and are used at opposite ends of the deal. The proforma is issued before the order is confirmed and is an offer. The commercial invoice is issued when the goods ship and is a demand for payment, a customs declaration of value, and an accounting document all at once.
The practical rule: a proforma may be revised freely until the buyer accepts it. A commercial invoice may not. Once your buyer's bank has an LC open against your proforma, every material term on the commercial invoice — the goods, the amount, the Incoterm, the port pair — has to match what the credit says, or the bank raises a discrepancy and you do not get paid on presentation.
That is the whole reason to take the proforma seriously. It is not paperwork you produce to be polite; it is the document that every later document is checked against.
Mistakes that cost money
No validity date, then a freight spike. Ocean rates have doubled inside a quarter more than once this decade. An open-ended offer is a free option you handed your buyer.
An Incoterm copied from the last deal. FOB on a container shipment where you actually hand over at an inland depot is the wrong rule, and it puts risk on you for a leg you do not control.
Quoting a price with no currency, or in a currency your bank cannot receive cheaply. Add the correspondent bank now, not after the wire is stuck.
Describing goods the way your warehouse describes them. "Model A-3" means nothing to a customs officer. The description and the HS code have to agree, and both have to survive translation.
A proforma that does not match what you can actually ship. If the packing list and commercial invoice later disagree with it, the bank's document check is where you find out — at the moment you most need to be paid.
Common questions
Is a proforma invoice legally binding?
It is an offer, and it binds you to the terms you stated for as long as you said they stand — which is exactly why the validity date matters. It does not bind the buyer to purchase, it is not a tax invoice, and it creates no receivable. Once the buyer accepts and you ship, the commercial invoice is the document that demands payment.
Can my buyer open a letter of credit with this?
Yes — that is the main reason this document exists. Their bank needs the goods, amount, currency, Incoterm and shipment window in one referenced document. Make sure the proforma number, the description and the terms are ones you can reproduce exactly on the commercial invoice later, because the bank will compare them.
Do I have to include an HS code?
Nothing stops you generating the document without one, and the document will print a visible "missing" marker where it should be. You should include it: the destination customs classifies on the HS code and the duty your buyer pays depends on it. If you are unsure of the code, confirm it before you quote a landed price.
Is this proforma invoice generator free?
Yes — free, and there is no account to create. Fill the form, watch the invoice build as you type, and we email you the PDF. We ask for an email address only because that is how the document reaches you.
Do you store the data I type?
We keep your submission so we can generate and email the document, and we delete it on a fixed retention schedule. The live preview stores nothing at all — it runs before we ask you for anything. Bank details are never saved to your browser. See our privacy policy for the detail.