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Short-term financing refers to the practice of borrowing money or obtaining funds for a short period of time, typically less than one year, to meet the financial needs of a business. This type of financing is often used to cover temporary cash flow shortages, fund working capital requirements, or take advantage of immediate investment opportunities. Short-term financing options may include lines of credit, trade credit, commercial paper, or borrowing from financial institutions. This form of financing is usually repaid within a relatively short timeframe, making it a convenient solution for businesses in need of quick capital.