The best methods to exchange currency in Iceland

You can exchange currency in Iceland at the airport, in banks, exchange offices and some hotels. There are also ATMs available in most towns and cities. But which should you use? Let’s take a look at the pros and cons of a variety of methods of exchanging currency in Iceland to find out which is best.

In Reykjavik and larger towns such as Akureyri, exchanging money is straightforward and if you find that you need cash, this won’t be a problem. If you are out in the countryside, however, it could be more inconvenient if you find yourself in need of money and you could need to travel a significant distance to find some. Be prepared and make sure you have access to funds – via cash or cards – before setting off on a road trip.

Where to change money

Airport foreign exchange desks are ideal if you have forgotten – or have been too busy – to organise your currency in advance. As you usually walk right past them as you exit the baggage hall (either in the hall itself or landside in the arrivals hall), there’s little or no time issue. Some also have extended opening hours so they can be great for early or late arriving flights.

Change Group are planning to open a foreign exchange service at Keflavik Airport soon but it hasn’t yet opened; keep an eye on the airport website for updates. You’re unlikely to get the best possible rate at an airport foreign exchange bureau, but this may not be a major consideration if you are charged a percentage commission and only need a small amount – in other words, the convenience is worth the slightly increased cost.

Once you’ve left the airport, your best bet if you need to get your hands on some Icelandic currency is to visit a bank. Typically you’ll need to show photo ID (such as your passport) before you can make a transaction. Let’s look at the country’s two biggest players, both of which have an online chat facility on their website if you have any immediate questions:

Landsbankinn

This bank has a large number of branches throughout Iceland, covering all regions of the country. There are four branches in Reykjavik, two more in the wider capital region, and branches in towns such as Akranes, Akureyri, Ísafjörður, Selfoss and more. Many of the branches in larger places are open daily during the week from 10am to 4pm, though smaller branches may have reduced hours (often 12 noon to 3pm) or might only open for a couple of days each week.

In addition to the cashier service, you can find out on the Landsbankinn website whether a particular branch has a currency ATM and if so, which currencies are available. This too can vary. Usually US dollars, euros and British pounds are offered, but you might also find Polish zloty in some of them; this might indicate which foreign notes a cashier is likely to accept.

Arion Banki

This bank offers foreign exchange at any branch where there is a cashier. The currencies accepted are US dollars, British pounds, euros and Polish zloty. The bank has branches in Kópavogur (the closest option for anyone based in Reykjavik), Borgarnes, Selfoss, Vik y Myrdal, Akureyri, Sauðárkrókur and Egilsstaðir.

That means if you are travelling beyond Reykjavik and find yourself in need of cash, you can pop into a branch as you’re passing. Note that these branches may also have a currency ATM which might be a useful gauge for travellers. Most of these branches are open from 10am to 4pm during the week, but Borgarnes and Vik y Myrdal have reduced opening hours, so check listings to make sure you don’t have a wasted trip.

Íslandsbanki

Note that at branches of Íslandsbanki, you would need an Icelandic ID number (kennitala) to be able to exchange currency. They also have specific ATMs where you can withdraw currencies, but you need to be a customer of Íslandsbanki in order to do that. In practice this rules them out an option for most travellers.

Another option you might find within a shopping area of a city is a foreign exchange office, sometimes referred to as a bureau de change. These are popular options in some cities around the world as they are generally easy to find and located close to retail outlets. Often, they have longer opening hours than banks.

However, you won’t currently find these in Iceland. As of May 2024, FX Iceland on Kolagatain downtown Reykjavik is closed and even in malls such as Kringlan you won’t find them. As more travellers use their own credit and debit cards, or methods of payment such as Apple Pay on their smartphones, demand for forex branches is falling, so perhaps it should be no surprise that facilities are becoming more limited.

Depending on where you are staying, the front desk of your hotel might have the facility to change some currency for you. Assuming it’s possible for the hotel to exchange money, this can be the most convenient option. There’s often someone on reception 24/7 and so you might be able to change money very early or late in the day – something you wouldn’t be able to do if you need to see a bank teller, for example.

However, you’ll often pay for this convenience in the form of a less favourable exchange rateor a relatively steep commission charge. Also, the list of currencies that any hotel will accept is likely to be limited to a few major ones, perhaps US dollars, euros and British pounds. If you’re not carrying cash in those currencies, it’s going to be harder to change up. If you plan to rely on such a service, it’s also a good idea to email ahead of your visit and make sure currency exchange is still offered.

Should you change money before you come to Iceland?

In some parts of the world, it’s not possible to take money out of the country legally as they have what’s known as a closed currency. The list of countries is quite an eclectic one and includes India, Tunisia, the Bahamas and Sri Lanka. Fortunately, Iceland isn’t among them soyou are able to buy Icelandic currency in many countries before you depart.

It’s possible to do this in a range of places, which depending on where you live can include banks, post offices and foreign exchange kiosks. The rates can vary according to how much you buy but regardless of the amount are lower than the standard rate you’ll see advertised on online currency tracker sites such as xe.com. Sometimes this s because they advertise purchases as commission-free although a fee is often charged on top.

However, you’ll often get a better rate if you order Icelandic currency at your own bank than if you wait to do it over the counter in Reykjavik or beyond. Typically you might need to give a couple of weeks’ notice to allow the bank time to order in the currency you want, but most banks will be able to offer this service.

Do you need to exchange currency in Iceland at all?

In many countries, Iceland included, cash is no longer as widely accepted as it once was. Even small businesses are likely to encourage contactless payment by credit card (Visa and MasterCard are most commonly accepted, American Express less so). Alternatively, debit cards can be used.

For larger purchases such as tours, it’s now far more common to book and pay online than to visit a tour office as you might once have done. That means whether you’re buying a couple of coffees in a Reykjavik café or organising a whale watching trip, those Icelandic krónur notes are more likely to stay inside your wallet now than ever before.

Nevertheless there are still occasions when you might need a small amount of cash, so most travellers to Iceland will want to change up a little bit. It offers peace of mind in the unlikely event your credit or debit card won’t work in the machine. You might also want to leave a tip (though this is never expected in Iceland) and could prefer to do so in cash. Or there might be the odd occasion where a business doesn’t (or temporarily cannot) take cards, such as smaller hot springs.

Whatever you decide to do, it’s always good to have a backup method of obtaining or carrying currency for emergencies. Nothing ruins a great holiday faster than running out of cash!

If you're unsure on which currency is used in Iceland, check out our blog post on 'Which currency does Iceland use?'