Thousands more people have borrowed money from banks to improve their homes and buy cars over the past year.

new data sets from banks show that 140,000 personal loans were taken out last year, with home improvement credit being the fastest growing segment.

The Irish Banking and Payments Federation report found that 12,000 more loans were issued by major banks last year than in 2020.

Figures do not include credit unions, which have traditionally been the main source of personal loans.

However, borrowing levels were heavily impacted by the pandemic in 2020.

Borrowers collectively took out 1.4 billion euros in bank loans last year.

But despite the increase in the number of loans issued, the average personal loan fell to €8,652. The average loan size was €10,370 at the start of last year.

Home improvements were the main reason people borrowed from their bank – accounting for nearly 12,000 of loans in the last three months of last year.

For Over the whole of 2021, there were 43,336 loans taken out with banks to finance work on houses.

The number of loans to finance housing works increased by a third compared to the fourth quarter of 2020.

And the value of these loans increased by 20% over the year, said the Federation of Banks and Payments.

During 2021, home improvement loans were the fastest growing segment. The average home improvement loan was €9,748 at the end of last year, compared to €10,899 in the fourth quarter of 2020.

Consumers took out 10,200 auto loans ahead of last Christmas. It was up 10% on the year.

In total during 2021, nearly 45,000 car or auto loans were drawn, for a value of €488 million.

The average car loan stood at €10,474 at the end of 2021, compared to €11,135 a year earlier.

Banking and Payments Federation chief executive Brian Hayes said an average of 2,756 loans were drawn per week.

He said 864 of those were car or auto loans, and 833 of them for home renovations.

“Covid-19 restrictions had a substantial negative impact on lending activity, particularly in the second quarter of 2020, but with improving consumer confidence we expect demand for personal loans to increase in 2022. .”

Mr Hayes said the new figures released by the banks provided a comprehensive overview of the number and types of personal loans being drawn.

For the first time ever, these new figures give us insight into the massive scale of personal lending by Banking and Payments Federation Ireland members.

Last week, money app Revolut announced that it would start offering personal loans and credit cards after obtaining a full banking license.

The Lithuania-based company says it now has 1.7 million customers in this market as it continues to expand rapidly.

And a recent Central Bank report showed that credit unions have started to recover from a lending slump that hit them at the start of the pandemic.

But they are still struggling to get members to borrow.

Total loans in the sector increased by 3.1% last year, reaching 5.25 billion euros.