Based on the loan tenor, term loans are broadly classified into short-term and long-term loans. Short-term loans are those with a short tenor, which can be between 1 and 5 years. On the other hand, long-term loans are those with a longer tenor, usually between 10 and 15 years or more.
When taking a business loan, be aware of your need for funding and opt for an instrument accordingly. Short-term loans are usually better suited for urgent expenses, whereas long-term loans help by keeping EMIs manageable all through.