A coupon is a ticket or document that can be exchanged for a financial discount on a product. Customarily, coupons are issued by manufacturers of consumer packaged goods or by retailers, to be used in retail stores as a part of sales promotions. They are often widely distributed through mail, magazines, newspapers and the Internet. Internet coupons have become very popular as of late, because the cost is borne by the user (who has to print off the coupons themselves) as opposed to the businesses issuing the coupons.
Coupons are also "attached" to bonds, either physically (as with old bonds) or electronically. Each coupon represents a predetermined payment promised to the bond-holder in return for his or her loan of money to the bond-issuer. (The bond-holder is typically not the original lender, but receives this payment anyway.) The coupon rate (the amount promised per dollar of the face value of the bond) helps determine the interest rate or yield on the bond.
The phrase "coupon clipper" can refer to either a bond-owner or someone who uses coupons from newspapers.
Another type of coupon is the trading stamp.
It was used as a temporary currency for some former Soviet countries, especially Moldova (used until 1993, replaced by Moldovan lei), and Ukraine (replaced by hryvnia in 1996) after they became independent.
The term "coupon" is also used in manufacturing and material science to refer to a small piece of material used for testing or further processing, compare billet.
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Last updated: 10-18-2005 06:32:19
