Short-Term Loan
A Short-Term Loan is a business finance product designed for periods typically less than 12 months. These loans are used for immediate cashflow needs, bridging funding gaps, or urgent operational expenses. They may be secured or unsecured and often complement facilities such as Working Capital Loans, Business Lines of Credit, and Invoice Finance.
Why Short-Term Loans Matter
Short-Term Loans provide quick access to funds for SMEs in the Tradie Hub, Truckie Hub, Café Hub, and Whitecoat Hub. If you are weighing up whether a lump-sum short-term loan or a revolving facility is better, the articles on Working Capital Loans 2025, Business Line of Credit Guide, and Invoice Finance 101 walk through the pros and cons in detail.
- Immediate access to working capital
- Bridges gaps between receivables and payables
- Supports urgent operational expenses or payroll
- Reduces reliance on invoice finance or overdrafts for small shortfalls
How Short-Term Loans Work
- Application evaluates cashflow, credit history, and business performance.
- Loan is approved for a fixed short period (typically <12 months).
- Repayments and interest are usually structured weekly or monthly.
- May require collateral or Director’s Guarantee for larger amounts.
- Funds are released for operational needs immediately after approval.
Short-Term Loans are considered part of the broader cashflow system alongside Invoice Finance, Business Line of Credit (LOC), and Working Capital Loans (WCL). For a bigger-picture view of how these pieces fit together, see the Business Cashflow System (WCL + LOC + Invoice) guide.
Related Switchboard Resources
Official info: business.gov.au