What is typically the required repayment period for a short-term finance source?

The required repayment period for a short-term finance source is typically less than one year. Short-term financing is designed to meet immediate financial needs, such as covering operating expenses or managing cash flow fluctuations. Businesses often utilize such finance to address temporary financial gaps, meaning that the expectation is to repay the borrowed funds in a short time frame.

In practice, this can include options like overdrafts, short-term loans, or lines of credit, which are all intended to be settled quickly as the business expects to generate sufficient revenue in the near term to cover these costs. This characteristic distinguishes short-term financing from longer-term sources, which are suited for more sustained investments and come with extended repayment periods.