A short-term loan is a small amount of money you pay back, plus interest, daily over the course of 3 to 18 months.
Short-term loans help business owners solve short-term financing problems, ranging from cash flow shortages and unexpected expenses to canât-miss business opportunities.
Short-term loans work similarly to traditional term loans. Youâll receive a certain sum of capital, then pay that back with interest and fees over a set amount of time.
But there are a few key differences with short-term loans. Loan amounts are smaller, repayment periods are much shorter, interest rates are drastically higher, and there are often daily or weekly repayment schedules.
However, short-term loans tend to have easier qualifications, faster applications, and quicker funding times.