DIFFERENCE BETWEEN SHORT TERM AND LONG TERM FINANCING

SHOR TERM FINANCE	LONG TERM FINANCE
Short term finance is raised for meeting the day to day requirements of the business such as meeting various expenses, purchase of goods, raw materials, payment of wages to employees etc.	Long term finance is raised to meet the long term requirements of a business such as buying a fixed.
It is to be repaid within in a period of two years.	It is to be repaid over five years or more.
Bank overdraft is an example of short term finance.	Issuing more shares and using retained profits are examples of long term finance.