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A short term loan like what the name suggest is given for a short period of time say 1 month or maximum of 60 days. Being short term in nature, the rate of interest on the amount so borrowed is very high. On an average, one can avail at a maximum of $1500 dollars in short term loans and not more than that.
By September 1976, Britain had already drawn heavily on the short-term loan and it was apparent that a loan from the IMF would be necessary to fund repayment. The 3.9 billion dollar loan As pressure on the pound continued, the government approached the IMF for a loan of $3.9 billion in September 1976.