What type of finance typically requires repayment over a longer period?

Medium-term finance typically involves borrowing funds that are to be repaid over a period ranging from one to five years. This type of financing is often used by businesses for purposes such as purchasing equipment, vehicles, or other assets that have a useful life extending beyond a single year. The longer repayment period allows businesses to manage their cash flow more effectively while still acquiring the necessary resources to support their operations and growth.

In contrast, short-term finance is usually for a duration of one year or less, addressing immediate financial needs, while immediate finance focuses on funding needs that require swift resolution, typically within a few days or weeks. Personal loans can fall into various categories, but when referring specifically to repayment periods, they can be either short or long-term depending on the specific loan agreement, rather than being an explicit definition of medium-term finance.

Thus, medium-term finance stands out as the option that specifically aligns with the requirement for repayment over an extended timeframe.