Personal loan drawdowns hit record highs in second quarter

During the second quarter, there were just under 71,000 personal loans drawn down with the combined value reaching €754m

The value of personal loans issued by banks between April and June hit a record high of €754m, driven by a 23.5% increase in loans for specific purposes such as education or special occasions, the latest data from the Banking and Payments Federation, Ireland (BPFI) shows.

During the quarter, there were just under 71,000 personal loans drawn down, with the combined value reaching €754m, an increase of 16.9% in volume and a 17.6% increase in value compared to the same period in 2024.

The size of the average personal loan rose by €60 to €10,620.

The increase in the number of loans drawn down corresponds with the European Central Bank (ECB) continuing to reduce interest rates. Between December 2024 and the end of June this year, the ECB cut interest rates by a full 1%, leading to cheaper access to lending.

BPFI chief executive Brian Hayes said these figures “indicate a sustained increase in demand for personal lending” reaching the “highest quarterly loan activity levels on record across all categories”. 

Car or auto loans accounted for €260m of the total combined value spread across 20,131 different loans. The size of the average car loan stood at €12,905 — an increase of €300 year-on-year.

This was also the first time since BPFI started keeping record that car loans surpassed 20,000 in a quarter.

There were 17,740 home improvement loans drawn down during the second quarter — an increase of 10.3% — with a combined value of €228m — up 12.5%. The average loan size in this category was €12,823, from €12,568.

Between January and June this year, there were 81,742 cars registered for the first time in Ireland, according to data from the Society of the Irish Motor Industry, an increase of 3.5% compared to the same period in 2024.

The “other loans” category — which includes loans for education, holidays and special occasions such as weddings — saw 33,087 loans drawn down — an increase of 23.5% year-on-year, with the combined value reaching €266m, a 24.3% increase.

The average loan value for this category reached €8,049.

Green loans — which are used to pay for home environmental improvements, energy efficiency upgrades, or even for electric cars — saw the largest increase of any category from a relatively small base.

In total, the number of loans drawn down increased by 30.5% to 1,635 while the combined value increased by 24.4% to €39.3m. The average green loan was relatively high at €24,051, more than twice the average of €10,620 for all loans in the same quarter.

In the first half of the year, there were 131,728 personal loans drawn down valued at more than €1.4bn.

Mr Hayes said the number of personal loans issued during the first six months of the year was “more than double the volume and value in the same period of 2021”.

“These figures come as the Central Bank of Ireland reported that medium-term household loans exceeded €12bn in outstanding value by the end of September 2025, the highest level since October 2012."

The BFPI’s personal loan data goes back as far as the first quarter of 2020.