Credit Card Usage in Iceland A Travelers Handbook

Icelanders use credit and debit cards for significant purchases and small expenditures like cab rides, coffee, and ice cream. Many places take Visa, Mastercard, American Express, and Diners Club. Electron, Maestro, and EDC debit cards are becoming more widespread, while Discover cards are rarely accepted.

The Icelandic Króna is the currency. Using chip-enabled cards with 4-digit PINs makes credit cards in Iceland a versatile payment option at most hotels and businesses nationwide. Travelers in the countryside, mainly for self-service petrol stations, need a PIN. Currency exchange is available in many Reykjavik banks and one airport branch. ATMs are also present in small towns and villages around Iceland, making cash access easier. So, now that you have a brief overview of the payment system in Iceland, let’s get to the details.

Credit Cards in Iceland

Credit cards are widely accepted and convenient in Iceland. Therefore, visitors use them. Let’s clarify which credit cards are accepted.

  • Credit cards like Visa and MasterCard are frequently accepted.
  • In Iceland, the Diners Club credit card offers more payment options.
  • JCB is another credit card accepted, giving visitors extra payment options.

Using Your Credit Card

A credit card in Iceland is simple. The majority of hotels, stores, and restaurants accept credit cards. Pay using your card at the cashier or card terminal. However, remember this tips:

  • Ensure the business displays Visa, MasterCard, Diners Club, or JCB logos.
  • In Iceland, credit card transactions frequently require a 4-digit PIN for protection. Input your PIN for card verification.
  • Avoid exchange rate issues by paying in Icelandic króna (ISK) instead of your local currency.

Understanding Icelandic Credit Card Fees

Beware of surcharges while using your American credit card in Iceland. These fees can mount up and affect your expenditures. Let’s discuss Iceland’s credit card fees.

Foreign Transaction Fees

Many American credit cards incur international transaction fees when used abroad. These costs average 2%–3% of the transaction. Every credit card purchase in Iceland incurs a small fee. Some banks provide cards without these fees, making foreign spending cheaper. Foreign transaction fees are waived on the Chase Sapphire Reserve credit card.

Dynamic Currency Conversion Fees

Iceland may offer to swipe your card in Icelandic króna or US dollars. You must pick Icelandic króna. Choosing US dollars may appear handy, but dynamic currency translation typically results in poor exchange rates and extra expenses. Always pay in local currency and let your bank convert it to avoid these unnecessary expenses.

ATM Fees in Iceland

Credit card withdrawals in Iceland or your home country are usually not recommended owing to fees and terms. The best credit card to use in Iceland cash withdrawals involves average transaction costs, lending fees, and credit card issuer conditions.

Iceland charges a flat transaction fee or a withdrawal percentage (0.75%) like other countries. Credit card firms may impose higher interest rates for cash advances, generally on the day of withdrawal. Be aware of these prices and consider using debit cards or card transactions to reduce them in Iceland.

Tips to Reduce Fees

Before your travel, study your credit card terms and restrictions to understand international transaction costs. Try to get a credit card without these fees.

Inform Your Bank

Tell your bank about your Iceland trip before you go. This keeps transactions from being recognized as suspicious, allowing continued card use.

Prioritize Using Credit Card

Prioritize using a credit card in Iceland without international transaction fees throughout your vacation to avoid unnecessary expenses. Using your credit card in Iceland with awareness of these costs and thoughtful judgments will help you budget and travel more smoothly.

Use American Express in Iceland

Iceland is secure, but Amex may need help. Amex is only accepted in some places. Some high-end hotels and restaurants accept it, although most prefer other cards. And remember, when you do taxis in Iceland take credit cards.

However, this problem goes beyond Iceland. Due to hefty interchange fees, numerous companies and organizations worldwide refuse American Express. Smaller firms may need help with these expenses. Visa and MasterCard, which have reduced interchange costs, are favored by companies and consumers.

Understanding Icelandic Credit Cards

Compared with European trends, Iceland has switched from magnetic-stripe to chip-enabled credit cards, offering better security and fraud prevention. Magnetic-stripe cards can be used in Iceland, but you must sign a receipt to authenticate your purchase. Sometimes you must show your passport. However, chip cards may be a good travel accessory due to their safety features.

Using Chip-and-Signature Cards

Chip-and-signature cards are popular in Iceland. Most places will accept a signature instead of a PIN for card verification. Sign the receipt and sometimes produce a passport to complete the purchase. Unmanned devices may need fixing, including petrol stations, automatic parking machines, public bathrooms, transportation ticket vending machines, and food and beverage machines.

Considerations for Specific Situations

  • Chip-and-signature cards take longer to process, so some may not prefer them to use in supermarkets. Some companies urge workers only to accept signature-based cards to ensure clarity.
  • Iceland has a few cashless gas stations. Gas may be rigid to purchase with a chip-and-signature card and no cash. Starting your visit with prepaid petrol cards might solve this problem. N1, a famous brand, is recommended for its vast station network.
  • Iceland has switched to chip-enabled credit cards for security, although magnetic-stripe cards still work. Chip-and-signature cards are accepted. However, unmanned machines and certain companies may not. Planning for things like gas on your Icelandic vacation will make payment more manageable.


Iceland allows large and small credit card purchases, simplifying financial travel. As Iceland’s ‘Safest Country in the World’ status matches domestic safety standards, credit cards are easier to use. Iceland’s move from magnetic-stripe to chip-enabled credit cards indicates security. Understanding the best credit card to use in Iceland guarantees a safe and financially prudent visit to this lovely island.

About Ajay Sharma 1322 Articles
Explore, learn, write - An creative writer getting to explore the all view who feels it is a digital adventure. With 9 year of experience in SEO writing still he says to be a beginner in learning.

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