Legal Definitions - short-term debt

Short-term debt refers to a financial obligation that a company or individual owes and must pay back within a year or less. It is also known as current liability.

Examples of short-term debt include:

• Credit card debt
• Payroll expenses
• Accounts payable
• Short-term loans

For instance, if a company borrows money to pay for its operating expenses, it may have to repay the loan within a year. This loan is considered short-term debt. Similarly, if an individual uses a credit card to make purchases, they must pay back the amount owed within a certain period, usually a month. This credit card debt is also an example of short-term debt.