Ireland’s banks have reported strong Q2 growth in personal loans activity compared with a year earlier as consumers borrow to fund holidays.

Data from Banking & Payments Federation Ireland shows the value of personal loan drawdowns in the April to June 2022 period (which excludes mortgages) increased by 20.1% year on year to €414m.

Two factors are behind the growth: as well as a surge in borrowing for holidays, banks have given out more loans for home improvements.

On an annualised basis, €1,540m was drawn down in the twelve months ending June 2022, a 4.7% increase on the 12 months to the end of March 2022.

Home improvement loans in Q2 were 12.7% ahead of the same period in 2021, driven by householder investment in retrofitting.

In Association with

Car and auto finance loans declined 0.4% year-on-year in the quarter.

‘Other’ loans, which includes loans for holidays, edication and weddings, increased by 59.2% year-on-year through the second quarter.

For the H1 period 2022, other loans exceeded car loans by €8m. For the same period in 2021, car loans exceeded other loans by €80m.