The volume of personal lending in Ireland during the third quarter increased 12.1% year-on-year to 47,094 as Irish residents turned to lenders to cover the cost of education, holidays and special occasions such as weddings.

Banking and Payments Federation Ireland (BPFI) figures show personal lending during the quarter totalled €442m, an increase of 11.2% in value year-on-year.

However, the size of the average personal loan fell slightly from €9,451 in Q3 2021 to €9,376 in the three months to the end of September.

Other loans accounted for the largest portion of personal loans in Q3 as lending volumes grew 26.1% to 22,403 while the value of those loans increased 21.8% to €166m. The average loan in this category was €7,414, down from €7,678 in Q3 2022.

Home improvement loans rose 8.4% in volume to 12,746 and in value terms by 11.9% to €140m, and the average value rose from €10,652 to €10,994 on an annual basis.

In Association with

Car loans rose 4.4% in volume to 11,945 while the total value was unchanged at €135m. Meanwhile, the average car loan of €11,331 was the highest value recorded since the series began in 2020.

"Today’s report shows continued growth in personal loan drawdowns with the volume and value rising in year-on-year terms for the sixth successive quarter and with the highest volume and values reached since BPFI began collecting this data in Q1 2020," said Brian Hayes, CEO of the BPFI.

"Of note is the jump we have seen in the number and value of loans being taken out for other purposes such as holidays, education and special occasions with home improvement loans also on the rise.

"By contrast however we can see that the volume of car loans has dropped with the value remaining static, however we did see an increase in the value of the average car loan to €11,113.”

(Pic: Getty Images)