Funding Pulse Q2 2026: SME Borrowing Costs Rise as Lending Eases
The latest Funding Pulse Q2 2026 report presents a mixed picture, with rising borrowing costs, softer new lending and continued investor interest in Irish businesses.
Compiled in partnership with the Strategic Banking Corporation of Ireland (SBCI), our Funding Pulse report offers a clear, grounded view of how the funding landscape is evolving.
Highlights:
SME Lending and Borrowing Costs
Outstanding SME debt reached €14.51 billion in Q2, its highest level in twelve months and an increase of 2.3% on the previous quarter.
Meanwhile, gross new SME lending eased to €1.24 billion, down 2.5% quarter-on-quarter and 4.4% year-on-year.
Borrowing costs also moved upwards, with the average interest rate on new SME lending reaching 5.6%, compared with 5.15% in Q1.
Investment Activity Remains Encouraging
Beyond traditional lending, venture capital activity remained strong, with significant funding rounds across fintech, technology and life sciences. International investors accounted for 82% of investment volume, according to the IVCA.
Irish M&A activity also remained active, with notable domestic and international acquisitions reflecting continued interest in Irish businesses.
What Does This Mean for Irish SMEs?
With borrowing costs increasing, understanding the available funding options and choosing the right financial structure is becoming increasingly important.
Whether planning for expansion, investment or acquisition, businesses need a clear picture of both the opportunities and costs involved.
Read the full Funding Pulse Q2 2026 report for the latest data and analysis on SME lending, funding costs, venture capital, investment and M&A in Ireland.
