The Travel Money Guide to Currency in Iceland
It's hard not to love Iceland? Dramatic landscape with volcanoes, natural hot geysers and massive glaciers. But it's an expensive destination and to get the most out of your trip, it’s a good idea to learn everything you can about the local currency and payment options before you go.
Want to learn more about the currency in Iceland and how to get your hands on it for the best value? Read on to find out:
What Currency is Used in Iceland?
The official currency of Iceland is the Icelandic Krona, which has the international code ISK and the symbol kr. Krona means crown and other Scandinavian countries such as Denmark and Sweden also use their own Kronas as currency.
Icelandic banknotes have 5 denominations:
The Icelandic Krona has 5 coin denominations: kr1, kr5, kr10, kr50 and kr100. Kr1, kr5 are silver kr10 and kr50 and kr100 are gold.
How to Buy Icelandic Krona Before You Go
There’s a certain reassurance that comes with stepping off the plane (or cruise ship) already cashed up with Icelandic Krona.
Buying Icelandic Krona before you leave Australian shores isn’t just convenient. It can also save you money. But it all depends on where you get your Icelandic Krona in Australia. There are three 3 options:
- Buy ISK online and have it delivered or collect it in-store
- Swap Iceland currency for Australian dollars from a money changer
- Buy Icelandic Krona at your home airport
Try S Money or a similar online currency exchange store to get rates that reflect the comparisons you see on XE or Google.
If you choose online delivery or in-store pickup, check the processing time. Some exchange companies with online options suggest you allow between two and five days to process currency.
Prefer in-store currency exchange? Head to the CBD of your nearest city for the most competitive exchange rates; suburban bureau de change outlets tend to have poorer rates and fees.
Currency exchange counters in Australia’s airports are infamous for their atrocious exchange rates. Avoid them if you can.
How Much Cash Should I Bring to Iceland?
Budgeting for your trip gives you a good idea of how much you may need for the length of your stay. This might keep you accountable, help you stretch your savings, or help you avoid having to convert currency back into dollars at the end of your trip.
The average daily travel budget in Iceland is about $230. Some of the expenses you might be looking at include:
$200 per night
A double room in a mid-range hotel
Inexpensive restaurant meal
A bottle of beer
Average daily transport
Admission for entertainment
How to Change Currency When You Arrive
Places like Reykjavik, and Akureyri receive great numbers of tourists, so there are facilities to cater to money exchanges. Beyond these major destinations, it’s best to get cash before you venture into remote territory.
There are plenty of ATMs in Iceland and as we are all used to getting our cash out at ATMs, its handy. It can sometimes seems like the most convenient way to secure local cash abroad. Tomato ATMs are common in big cities and they are red in colour. They tend to be open 24/7. In addition there are ATMs at the Keflavik Airport, making things extra easy.
Depending on your bank, you may have to pay for overseas ATM withdrawals and currency conversions. To reduce the amount you’ll pay in fees, try to withdraw just the right amount of money you’ll need for the duration of your trip.
Don’t forget: Let your bank know you’re travelling! If they detect a foreign transaction but aren’t aware you’re overseas, they could end up freezing your card.
Currency Exchange in Iceland
You won’t have any problem changing money in Reykavik. The 2 prominent money changers are FX Iceland, which are a professional outfit with rates displayed and Landsbankinn which is one of the major banks in Iceland.
Money changers tend to offer marginally better rates than banks as many banks charge high flat fees of per transaction. Also, banks only exchange currencies on weekdays.
We do not recommend travellers cheques, while they may be accepted, few places outside the well-trodden tourist path will accept travellers cheques, so your best option is to exchange cheques for cash at a bank.
These days, when pitted up against plastic money and currency exchanges, travellers cheques seem more hassle than they’re worth.
Using Your Bank Card
Most Icelandic businesses are well set up to receive card payments. But before you use your bank card willy-nilly, it’s worth reading up on the fees and charges you might incur.
You’ll probably want a debit card if you plan to withdraw money from an ATM. While you may also be able to pay with a debit card in some businesses in the major destinations, you might discover some hefty fees on your account summary.
Depending on your bank, you could be hit with fees for foreign ATM withdrawals or currency conversions. But some banks are better than others; we recommend checking out ING, Revolut, and TransferWise, all of which have travel-friendly debit cards that waive these charges.
Credit cards can come with some enticing perks, including added security, loyalty programs, and even free travel insurance.
But are they worth it?
Major local businesses, including hotels, restaurants, airline offices, and department stores, accept credit cards. But you might have to pay a surcharge.
Mastercard and Visa are widely accepted. You may also be able to use your American Express card, though local ATMs won’t accept them.
Just be aware of additional charges you may incur for foreign transactions. These could include:
- International transaction fees
- High exchange rate margins
- ATM fees
- Potential ‘cash advance fees’ if you use an ATM
If you still prefer credit cards over any other payment, consider going with a company that offers cards that waive certain travel fees. Bankwest Platinum and 28 Degrees both have travel-friendly cards.
Prepaid Travel Cards
The biggest advantages of prepaid travel cards are that you can lock in a favourable exchange rate. You also get a handy back-up card.
Just remember that while they are convenient, you could end up paying a long list of hidden fees. Many travel cards still impose:
- Currency conversion fees
- Uncompetitive exchange rates
- International ATM withdrawal fees
- Initial load fees
- Reload fees
- Inactivity fees