IOU (debt)
rating: 0+x

Basic Information

An IOU is usually an informal document acknowledging debt, the name being contracted from the phrase "I owe you". In the pre-modern period, especially nineteenth century sources, this may be referred to as a "note of hand".

Once formalised, this tends to evolve into a letter of credit and thence to banknotes. Also, formalised debts, usually with payable interest and normally as issued by corporations and governments are tradable instruments in their own right in many economies, usually under the name of "bonds".

The acceptability and possible exchange value of an IOU depend a lot on the profile and reputation of the author - those of a known defaulter or bankrupt are likely to be almost worthless - and as such, in some circumstances refusal to accept an IOU may be interpreted as an insult: in effect, an accusation that the debtor is likely to dishonour the debt. Such notes are generally written between social equals or to a superior - lower status creditors may struggle to get a debt acknowledged at all.

An IOU or something similar may also be written by military or paramilitary forces when requisitioning supplies from civilians - this may or may not be a very thin veneer over outright pillage and militaries that can afford to and which care about public relations usually seek a reputation as rapid and generous settlers of such notes. Less responsible governments have been known to use these forms of payment outside times of emergency.

See Also



Game and Story Use

  • If one or more of the player characters need to pay off an IOU, it can serve as a great source of motivation for seeking out adventures - especially adventures with slightly dubious ethics.
    • A character might even start out with such a debt at character creation as a disadvantage.
  • On the other hand, perhaps the PCs have been given an IOU, and now want to collect - but the person who issued it is nowhere to be found. Finding him becomes a new adventure.
    • Someone else could also give an IOU given to him as a payment for other services to the PCs. The debt owed might then be significantly higher than it would be appropriate for "normal" pay for this service - as there is some risk involved in cashing the IOU in.
Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License