So, what is the currency of Iceland? It’s the Icelandic króna (ISK). This guide gives you the lowdown on handling money in Iceland, whether you prefer using cash or card.
We’ll also cover topics like VAT (Value Added Tax), tax-free shopping, and some tips on how to best manage your funds while you’re exploring Iceland.
The Icelandic Króna (ISK)
The Icelandic króna (ISK) is Iceland’s official currency. The word “króna” means “crown” in Icelandic. The ISK came into being in 1874, replacing the Danish currency at the time.
Compared to other currencies around the world, the ISK is considered relatively weak.
Icelandic banknotes are available in 500, 1000, 2000, and 5000 króna. You’ll also find coins in denominations of 1, 5, 10, 50, and 100 krónur.
Using Cards in Iceland
If you’re planning a trip, you can relax knowing that Mastercard and Visa are widely accepted throughout Iceland.
Contactless payments are common, though there’s a limit of ISK 7,500 per transaction. Chip and PIN payments are also standard practice. You’ll often need to enter your PIN to complete a purchase.
Most places actually prefer card payments over cash, so you might not even need to exchange much currency at all!
Cash Usage and Alternatives
Although credit and debit cards are widely accepted in Iceland, it’s still a good idea to have some cash on hand. You may need it for small purchases, taxi fares, and tips.
Withdrawing cash from ATMs or local banks in Iceland is generally cheaper than exchanging currency at the airport.
While some hotels and tourist-oriented businesses might accept U.S. dollars, British pounds, or Euros, it’s best to use Icelandic króna.
VAT and Tax-Free Shopping
Iceland charges a Value Added Tax (VAT) of 24% on most things you buy. Food and books are taxed at a lower rate of 11%.
If you’re not a resident, you can shop tax-free if you spend more than ISK 6,000 in a single store. Make sure to keep all of your receipts so you can claim your refund.
Frequently Asked Questions
How much is $100 US in Iceland today?
The exact amount will fluctuate depending on the current exchange rate. To find out, you can use an online currency converter like Google Finance or XE.com. Just enter $100 USD and convert it to Icelandic Króna (ISK) for today’s equivalent value.
How much is $1 US in Iceland?
Similar to the previous question, the exact value changes. Use a reliable online currency converter to get the most up-to-date exchange rate. This will tell you how many Icelandic Króna (ISK) you’ll receive for each US dollar.
What is the best currency to use in Iceland?
The best currency to use in Iceland is the Icelandic Króna (ISK). While credit and debit cards are widely accepted, having some ISK on hand is useful for smaller establishments, tipping, or situations where card payments aren’t possible. You’ll generally get the best exchange rates by withdrawing ISK from ATMs in Iceland rather than exchanging currency beforehand.
Can I use American money in Iceland?
While some tourist-oriented businesses might accept US dollars, it’s not the standard practice and you’ll likely get a poor exchange rate. It’s highly recommended to use Icelandic Króna (ISK) for most transactions. You’ll have a much smoother and more cost-effective experience.
Final Thoughts
While the Icelandic króna is the country’s currency, credit and debit cards are widely accepted. A little knowledge about VAT and tax-free shopping can help you get the most out of your visit. With a bit of planning, you can be sure your trip to Iceland is smooth and enjoyable.