All You Need to Know About Money in Iceland
Can you believe it? A country with a population of only about 330.000 has its own currency! In Iceland, we use the Icelandic króna, or short “ISK”. You will encounter high numbers in the thousands while being in Iceland, because 1 Euro currently equals about 120 ISK, 1 US dollar equals about 115 ISK and 1 British Pound equals about 140 ISK. Therefore, even your dinner will cost a few thousand ISK already. This can be very confusing when being in Iceland for the first time, but to make it a bit easier, you can start by just dividing the prices by 100 to get a rough estimate of what it costs in your currency at least.
Coins and Bills
As always when handling a foreign currency, the coins and bills can be really confusing and we all know that feeling of standing in a supermarket and taking ages to find the right coins in our wallet. In Iceland, we have coins with the values 1, 5, 10, 50 and 100 ISK. The bills come in values of 500, 1.000, 5.000 and 10.000 ISK.
How much cash should I bring?
After all this confusion, here come the good news: don’t even bother bringing cash money to Iceland or getting it from the ATM here. It is an unnecessary hassle to find a currency exchange and avoid exchange fees etc. Iceland is virtually cash-free and while on a tour through Iceland, there is hardly any place at all that you could encounter, which would not accept credit cards. The busses within the Reykjavik area do not accept cards, but downloading the bus app Straeto will allow you to easily pay through your phone.
Looking into the wallets of Icelanders, you will usually only find a bunch of cards, but not much cash. That said, we are talking about the most common credit cards of course, like Visa, MasterCard and American Express.
Anything else I should keep in mind?
If you want to gas up outside of the opening hours of a gas station, you will need a credit card with a four-digit pin code. Some credit cards, especially from the United States, can only be swiped or have a 5 or 6-digit pin code. These credit cards will NOT work, unless the gas station is open and you can pay inside. Other than that, you should be good to go with your credit card on your Iceland trip.
But what about tipping?
Tipping is not common in the Icelandic culture. Unlike in some other countries, waiters and waitresses can live from their wages here in Iceland and most often, you will see that Icelanders are not tipping after a meal or a taxi ride. You can easily consider it included in the prices.
That being said though, nobody will look at you strangely and you will of course make the waiters/taxi drivers/guides day if you decide to tip.