Friday, 14 June 2019

A Traveler's Guide to Icelandic Currency

When traveling abroad, one of the things to consider is how you will pay for everything. After all, vacations to Iceland aren’t free. You’ll probably be interacting with the local money, so it’s helpful to know about exchange rates, how to pay for food, where to get cash, etc. We’ve created this traveler’s guide to Icelandic currency with essential information to help you prepare for your trip.

Icelandic currency 1000 króna banknote

What is the Currency in Iceland? 


The official currency of Iceland is the Icelandic króna (ISK). Krona currency is issued by the Bank of Iceland, our central bank. They oversee the printing of money and also monitor the currency in circulation. We’ve used the króna since the late 1800s, back when we were under Danish rule. Later on, we began making our own Icelandic króna and eventually we fully took over our currency.

What Does Iceland Money Look Like?


Icelandic currency is some of the prettiest national money you will ever see. It features famous historical figures and rich illustrations on colorful bills. I like to bring foreign currency home as a souvenir, and you may find yourself thinking the same during your trip to Iceland.

Krona currency comes in both coins and banknotes. The coins have values of 1, 5, 50, and 100 krona. Our bills have denominations of 500, 1000, 2000, 5000, and 10000. They feature various shades of red, green, blue, purple, brown, and even some multicolored hues. We wanted our money to reflect our national pride, especially after struggling for so long to gain independence.

Some of the historically significant Icelanders on our bills are Jón Sigurðsson, a leader of the Icelandic independence movement, Brynjólfur Sveinsson, a Lutheran bishop, and Ragnheiður Jónsdóttir, a prominent woman in Icelandic society.

Icelandic currency króna coins

Do I Need Iceland Currency During My Trip? 


It’s understandable if you want to carry at least some cash with you; after all, you never know what emergencies might pop up. If you’d like to keep a couple of bills of Iceland currency in your back pocket, I’d suggest taking it out at the ATM once you’re there. Double check with your bank to see if they charge you a fee or commission for this. You can also request krona from your local bank, as they have very reasonable rates. Just give them ample lead time as it can take anywhere from a few days to a week to receive the money.

You may also find vendors who accept dollars, euros, or Danish, Swedish, or Norwegian krones.

What I don’t suggest is using the currency exchange bureaus you’ll find in the airport. These offer the worst deal you can get for your money, so I would avoid them like the plague.

Can I Use Debit and Credit Cards in Iceland?


To be perfectly honest, you don’t really need keep to cash on you during your Iceland trip. Both credit cards and your debit card are widely accepted, even at the famous Bæjarins Beztu Pylsur hot dog stand in downtown Reykjavik.

One thing you might not be aware of is that you need your credit card PIN if you plan on paying for anything with a credit card. If you don’t know what yours is, call your credit card company so they can mail it to you. And again, allow time for it to arrive because credit cards PINs are usually sent through standard mail.

What’s the Exchange Rate? 


The rate of currency exchange fluctuates according to global trends and seasonal factors. But just to give you an idea for planning your trip, here are the most recent rates for some common currencies.

1 USD = 126 ISK
1 EUR = 142 ISK
1 GBP = 159 ISK

Scandinavian Countries 

1 NOK = 15 ISK
1 SEK = 13 ISK
1 DKK = 19 ISK

Here’s a useful calculator to help you compare Iceland currency to USD and other world currencies.

Icelandic currency 5000 króna banknote

Tax-Free Shopping in Iceland and the VAT Refund 


You may have heard about getting a tax refund on your purchases in Iceland. As a tourist, you are entitled to getting up to 24% back on items you buy and plan on taking out of the country. This includes clothes, souvenirs, and other items. As long as you’ve spent at least 6000 Icelandic króna, you are eligible.

The process is very straightforward, but make sure you allow yourself ample time to get everything done. You’ll need to take care of this before you check your bags in, and the line for the VAT refund point can be quite long. Many tourists get turned off by this and forfeit their refund when they see how long the lines are. Arrive early!

When buying something at a store, ask for a tax-free receipt and be sure that you get the signature of the vendor. Then, when you arrive at Keflavik International Airport, head to either Arion bank or customs (depending on the amount of your purchases). Once you get your tax-free form validated, then head to the International Refund Point to get your VAT refund.

A Traveler's Guide to Icelandic Currency 


Now you’re ready to for your vacation. Traveling to Iceland is a great adventure, just make sure to pack your plastic. You’ll most likely be using cards to pay restaurants, tour operators, and the souvenir shop where you buy your traditional lopapeysa sweater. We use cards everywhere, so if you bring a Visa, MasterCard, or American Express, you’re all set. And maybe take some Icelandic legal tender home with you as a way to remember our amazing little country.

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