Irish consumers borrowed more money for car purchases in the first quarter of 2025 than at any point since detailed record-keeping began five years ago, with the average loan reaching €13,267 according to new industry data.
The Banking and Payments Federation Ireland reported that 19,552 car loans were taken out between January and March, collectively worth €259 million – representing increases of 21.5% in volume and 25% in value compared to the same period last year.
The surge in car financing contributed to broader growth in personal lending, with total personal loan activity reaching 60,770 loans valued at €683 million in the first quarter. This marks a significant year-on-year increase of 22.1% in volume and 24.1% in value.
Home improvement loans also showed strong growth, with 15,372 loans worth €198 million representing increases of 18.2% in volume and 19.2% in value. The average home improvement loan rose by €116 to €12,886.
Other personal loans for education, holidays, and special occasions like weddings totaled 25,846, valued at €226 million – up 25% in volume and 27.5% in value year-on-year.
Anthony O’Brien, BPFI’s Head of Sector Research & Analysis, attributed the car loan surge partly to “continued growth in electric and plug-in hybrid electric vehicles.” Green personal loans, covering both green cars and home improvements, showed the highest relative growth with a 29.3% increase in value to €35.1 million.
When viewed annually, the data shows 240,423 personal loans worth almost €2.6 billion were drawn down in the four quarters ending in Q1 2025 – more than double the value recorded in the twelve months ending Q1 2021, highlighting the sustained recovery and growth in consumer borrowing.