Ireland's two largest banks have reduced their mortgage rates in response to last week's half per cent interest rate cut by the European Central Bank.
AIB today announced it has reduced its variable mortgage rate by 0.38 per cent to 3.3 per cent. Bank of Ireland also confirmed this afternoon it will cut its mortgage rate by the full 0.5 per cent to 3.6 per cent.
AIB is also offering a five-year fixed term rate of 3.99 per cent for customers who may wish to lock in the current rates, which are at historic lows.
But the group representing small and medium-sized businesses - the Irish Small and Medium Enterprises Association (ISME) - said today's measures do not go far enough to help smaller businesses.
ISME called on the Government to apply pressure on the banks that the rate reduction is passed on in full not only to the domestic mortgages but to the business sector.
ISME said interest rate charges on lending facilities to small businesses are typically four to five percentage points higher that the existing mortgage rates.
"Clearly, interest rate policy is supportive of investing in bricks and mortar rather than wealth creation, job maintenance and generation," ISME said.