As the name indicates, short-term loans are loans that come with a shorter tenure, usually a year or less. It is a one-time repayment loan that is especially useful if you cannot avail a long-term loan.
Short-term loans are for smaller amounts, and the eligibility criteria are usually relaxed. However, banks will analyse the repayment capacity of the borrower. Since the tenure is low, the rate of interest for short-term loans is usually high. Many banks and NBFCs prefer to give short-term loans as they find them more profitable.