Short-term notes receivable are typically created when a company borrows money from another entity such as banks, investors, or financial institutions. These notes usually have a maturity of less than one year and are usually given in exchange for a promise to return the money plus interest. The note serves as evidence and protection for the lender, ensuring that the borrower will make all necessary payments on time and in the specified amounts. Simply put, short-term note receivables are agreements between parties to provide and receive money with an agreed upon repayment plan.