What is a common type of loan offered by commercial banks?

A common type of loan offered by commercial banks is short-term loans for commercial activities. These loans are specifically designed to meet the financial needs of businesses, allowing them to manage cash flow, purchase inventory, or finance operational expenses for a limited duration. Commercial banks often provide these loans with flexible terms that cater to the unique requirements of businesses.

Short-term loans typically have a repayment period of less than one year, which suits businesses that need quick access to capital to address immediate financial obligations or pursue opportunities for expansion. The process for obtaining these loans is usually expedited compared to long-term financing options, making them an attractive choice for business owners needing immediate funds.

In contrast, long-term mortgages are more related to real estate financing, while personal loans and home equity loans are primarily aimed at individual consumers rather than commercial entities. Thus, short-term loans for commercial activities are the most appropriate and common type of loan offered by commercial banks in the context of business financing.