Funding Pulse Q1 2026: What’s Happening in Ireland’s SME Funding Market?
The latest Funding Pulse Q1 2026 report offers an encouraging start to the year for Irish SMEs, with new lending picking up, funding costs easing and strong activity continuing across investment, venture capital and M&A.
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:
New SME lending gathers pace.
One of the clearest signals from Q1 is the increase in new lending.
Gross new SME lending reached €1.34 billion, up 12.9% on the same period last year. While outstanding SME credit remains slightly below Q1 2025 levels at €14.65 billion, the rise in new lending suggests businesses and lenders are showing renewed appetite for finance.
Funding costs ease.
There is also some welcome movement on the cost of borrowing.
The average interest rate on new SME loan drawdowns fell to 4.9% in Q1 2026, compared with 5.3% in Q4 2025. For businesses considering investment, expansion or acquisition, the cost of capital remains an important part of the conversation – and this quarter brought a more positive direction of travel.
Capital markets remain busy.
Bank lending is only part of the story.
A total of €5.4 billion was raised during Q1, with debt accounting for 76.5% of the total. There was significant activity across a range of sectors, including technology, life sciences, financial services and sustainable energy.
M&A was active too, with 136 deals completed during the quarter, four more than in the same period last year. Venture capital activity also remained strong, with a number of substantial funding rounds across Irish businesses.
What does it mean for Irish businesses?
The funding landscape is becoming increasingly varied. Traditional lending remains important, but businesses now have access to a much broader mix of options, from venture capital and private equity to alternative lenders and strategic investment.
That makes choosing the right funding route just as important as securing the funding itself.
For business owners thinking about growth, acquisition or investment in 2026, understanding what is happening across the wider market can help inform those decisions.
Read the full Funding Pulse Q1 2026 report for the latest data and analysis on SME lending, funding costs, venture capital, investment and M&A in Ireland.
