Ireland’s Car Loans and Personal Loans Reach Record Highs in 2023

In a remarkable turn of events, Ireland has witnessed an unprecedented surge in car loans, with the third quarter (Q3) of 2023 seeing a staggering 39.6% increase in value year-on-year to €189 million. This remarkable growth is matched by a 25.5% rise in the number of loans, which reached 14,490, marking the highest Q3 figures since 2020.

Record-Breaking Personal Loan Drawdowns

The Banking & Payments Federation Ireland (BPFI) reports that this surge in car loans contributed significantly to the overall record high in personal loan drawdowns in 2023. The total value of personal loan drawdowns between July and September last year reached a new peak of €552 million, up 25% from the previous year, with a total of 53,400 drawdowns, an increase of 13.4%.

Brian Hayes, CEO of BPFI, highlighted the remarkable growth in car loans, particularly for electric vehicles, which accounted for 19% of new cars licensed for the first time in 2023. The average loan value also increased to €10,336, with car finance loans averaging €12,599, reflecting higher car prices and the growth in luxury and electric vehicles.

Green Loans and Home Improvement Loans on the Rise

The upward trend was not limited to car loans alone. Loans for other purposes, including education, holidays, and weddings, grew by 7.1% to 23,990, with a value increase of 14.1% to €189 million. Home improvement loans experienced a 13.1% rise in number to 14,420, and a 23.9% increase in value to €174 million, the highest since the data series began.

Notably, green personal loans saw a significant rise of 143.7% to €27 million in Q3 2023, despite starting from a lower base compared to other categories. The average green loan value was reported at €21,600, up from €19,440 in the previous year.

A New Era of Borrowing

This surge in car loans and personal loan drawdowns signifies a new era of borrowing in Ireland, with consumers increasingly turning to loans to finance their purchases. The rise in green loans, in particular, suggests a growing awareness and commitment to sustainable living.

As we move into 2024, it will be interesting to see if this trend continues. Will the demand for car loans, green loans, and home improvement loans remain strong? Only time will tell. But one thing is certain: the Irish lending landscape is changing, and it’s changing fast.

In conclusion, the BPFI’s report paints a vivid picture of a nation on the move, with consumers increasingly turning to loans to finance their purchases. The surge in car loans, green loans, and home improvement loans suggests a growing confidence in the economy and a desire to invest in the future.

As we look to the future, it’s clear that the Irish lending landscape will continue to evolve, offering new opportunities and challenges for borrowers and lenders alike. Whether this trend will continue or change course remains to be seen, but one thing is certain: the story of Ireland’s surging car loans and record personal loan drawdowns is far from over.