Definition of time loan

short-term business loan

that is payable in full at a specified maturity date, e.g., 30, 60, 90, or 120 days. Interest on this type of loan ordinarily is deducted (discounted) in advance when the loan is made. It differs from a demand loan in that the lender cannot call or demand repayment of a time loan before the maturity. Time loans are repaid from turnover of assets, for example, the sale of inventory or collection of accounts receivable.