What term describes an agreement to pay for a product or service at a later date?

The term that describes an agreement to pay for a product or service at a later date is credit. When a customer uses credit, they are essentially borrowing money from a lender or retailer to make a purchase, with the understanding that they will repay that amount at a later time. This allows individuals or businesses to acquire goods or services immediately, while deferring the payment.

Credit can take various forms, including credit cards, store accounts, or loans, which all share the common characteristic of allowing for delayed payment. Understanding credit is essential in financial transactions, as it impacts how consumers manage their spending and debt.

The other options describe different financial concepts. A debit directly involves immediate payment from an account, an invoice is a bill requesting payment for goods or services that have already been provided, and a loan refers more generally to borrowing money that is expected to be paid back over time, which may or may not involve the immediate purchase of goods or services.