Iceland – Banking

What are the main banks in Iceland?

Iceland’s commercial banking sector is made up of four universal banks alongside five smaller savings banks that serve predominantly rural communities. Three of these institutions command the lion’s share of retail deposits and lending activity. All three provide English-language digital banking platforms, making them practical choices for newcomers who have not yet mastered Icelandic.

Landsbankinn — Landsbankinn is Iceland’s largest bank by total assets. In 2024, its total assets stood at 2,181.76 billion ISK, giving it a 37.45% share of the market. Established in 1886, it functions as a universal bank with a comprehensive portfolio spanning personal banking, corporate finance, and investment management. The bank is headquartered in Reykjavík. Its app and online banking platform can be operated in Icelandic, English, or Polish. Contact: +354 410 4000 or [email protected]. Official website: landsbankinn.is/en.

Arion Bank — Arion Bank holds the position of Iceland’s second largest bank by total assets. In 2024, its total assets reached 1,618.27 billion ISK, accounting for a 27.78% market share. Founded in 1984, Arion Bank is known for personalised service and forward-thinking digital solutions, offering retail, corporate, and institutional banking products. Official website: arionbanki.is/english.

Íslandsbanki — Íslandsbanki is a universal bank offering both retail and business banking to private individuals and commercial clients. It ranks third among Icelandic banks by total assets, with 1,607.81 billion ISK recorded in 2024, equating to a 27.60% market share. The bank traces its roots to 1875 through Álftanes Savings Bank and was reconstituted in its current form in 2009. It is headquartered in Kópavogur. Official website: islandsbanki.is/en.

Kvika Bank — Kvika Bank was founded in 2011 and has carved out a notable position in the Icelandic financial market by concentrating on commercial and investment banking rather than traditional retail services. With operations in both Iceland and the UK, Kvika focuses on fund management and investment solutions. For expats primarily interested in everyday banking, Kvika is less directly relevant, though those with specific investment requirements may find its offerings worth exploring.

Reykjavík Savings Bank, established in 1888, is a long-standing institution in the capital region with a focus on retail savings and community banking. Several further small savings banks operate in regional areas across the country. A complete register of licensed financial institutions can be found through the Central Bank of Iceland (cb.is), which is responsible for authorising and supervising all banks in the country. Always confirm current contact details and service terms directly with each institution.

Do any major international banks operate in Iceland?

Iceland has no international banks with physical retail branches, though ATMs throughout the country allow withdrawals from foreign bank accounts. Familiar global names such as HSBC, Barclays, Citibank, and Santander are entirely absent from the Icelandic high street.

Although Iceland is a member of the European Economic Area (EEA) rather than the EU itself, European financial passporting arrangements theoretically permit some cross-border service provision. In practice, however, the retail banking market is wholly served by domestic Icelandic institutions. If you currently hold an account with an international bank, you may be able to keep that account for use abroad, but you will require a locally held Icelandic account for receiving your salary, settling bills, and managing everyday expenditure.

International fintech providers such as Wise and Revolut do have a presence in Iceland and can usefully supplement a local account — particularly for international transfers and multi-currency transactions. These services are discussed further in the digital banking section below. As the international financial services landscape can evolve, it is always worth checking directly with any existing bank whether they can offer services relevant to someone resident in Iceland.

Do banks in Iceland offer accounts or services specifically for expats?

Foreign nationals face no legal barriers to opening a bank account in Iceland. Although none of the major banks market distinctly branded “expat accounts” in the style of some international institutions, all three have developed their services with non-Icelandic residents in mind.

Íslandsbanki has a dedicated team to guide foreign customers through the process of opening an account and managing their finances in Iceland. The bank provides English-language services and supports international transactions through both its online platform and branch network. Foreign nationals who have held an active account at Íslandsbanki for at least 12 months may apply for a loan. Those arriving from countries outside the EEA or EFTA will need to present a valid residence permit before a loan application can be considered.

Landsbankinn’s app and online banking are available in Icelandic, English, and Polish, and the bank offers multilingual customer support. Arion Bank has a well-regarded openness to customers of all nationalities and provides a range of services suited to foreign residents, including multi-currency accounts and comprehensive online banking facilities.

All Icelandic banks offer a selection of credit cards carrying varying annual fees depending on their features. Each bank also operates a prepaid card product secured against an initial deposit — a practical option for newly arrived expats who have not yet established a credit history in Iceland. Standard credit card applications are subject to a credit assessment, and foreign nationals may face additional conditions. For example, Íslandsbanki historically issued only basic cards to expats who had maintained an active debit account for a minimum of one year (as of 2022). Policy details can change, so always verify current terms directly with the relevant bank.

Savings and investment accounts are available across Íslandsbanki, Landsbankinn, and Arion Bank. Options include instant-access and fixed-term products, as well as non-index-linked and index-linked variants, with interest paid monthly or annually depending on the scheme chosen.

What are typical bank opening hours in Iceland?

Icelandic bank branches operate on weekdays only. Standard opening hours run from approximately 09:00 to 16:00, Monday to Friday. Branches are closed on weekends and public holidays, although larger city-centre branches in Reykjavík may keep marginally extended hours. It is advisable to confirm the specific hours of your local branch directly with the bank, as these can vary and are subject to change.

Landsbankinn’s Customer Service Centre operates on weekdays between 09:00 and 16:00, with advisors on hand to discuss products and services. The team can be reached by phone at +354 410 4000, by email at [email protected], or via the live chat function at landsbankinn.is.

The banking sector employs approximately 2,500 people across 69 branches nationwide. Both commercial and savings banks have progressively reduced their physical footprint and staffing since 2012, directing resources instead towards electronic self-service channels. The appetite for digital payments and online transactions was already growing before the pandemic and accelerated further during it. As a result, most day-to-day banking needs can be met entirely without visiting a branch.

Online banking is the primary channel for routine financial transactions in Iceland, with access requiring an electronic ID. Banking business can be handled through an app or web platform at any time and from any location. ATMs are plentiful — Landsbankinn alone operates machines at more than 60 locations around the country, with interfaces available in Icelandic, English, and Polish.

What do expats need to know about the banking system in Iceland?

A cashless society. Iceland operates as an almost entirely cashless economy. Debit card and smartphone payments are accepted at vendors across the country, including in remote rural locations. Unlike many places where coins and notes remain expected for small purchases or local markets, you can navigate daily life in Iceland without ever handling physical currency. This makes obtaining a functioning local account or an accepted international payment card an immediate priority upon arrival.

Salaries are paid directly into bank accounts. Every employer in Iceland pays wages directly into a bank account. If you are in paid employment, relying solely on a foreign account will simply not work — you must have a local Icelandic account in place to receive your salary.

Deposit protection. Deposit guarantees in Iceland are administered by Tryggingarsjóður (TIF), the Icelandic deposit and investor guarantee fund, a private foundation operating under Act No. 98/1999. Its purpose is to provide a minimum level of security to depositors at commercial and savings banks should a given institution become unable to meet its obligations. The guarantee follows EU models, with maximum protection set at €100,000 per depositor per bank (as of 2024). This is broadly comparable to the €100,000 limit under EU deposit guarantee frameworks, the FSCS protection ceiling of £85,000 in the UK, and the FDIC coverage of up to $250,000 in the United States. Always verify the current level of protection at tif.is.

Bank supervision. Íslandsbanki, Landsbankinn, and Arion Bank are all authorised and supervised by the Central Bank of Iceland. The state-owned Central Bank operates with independent governance and is charged with safeguarding price stability, financial stability, and the security of financial operations. It oversees the maintenance of Iceland’s international reserves and ensures the smooth functioning of domestic and cross-border payment systems. For authoritative regulatory information, visit the Central Bank of Iceland.

Highly digitalised infrastructure. The Icelandic banking environment is distinguished by its sophisticated digital infrastructure. Banks have invested heavily in online and mobile banking platforms, making financial services accessible and convenient from virtually anywhere. Iceland’s broad commitment to internet technology means that most government and financial processes are conducted online, with access authenticated through an electronic ID stored on your mobile phone’s SIM card. These electronic IDs are issued by banks and mobile network operators.

Government ownership. Since October 2015, the Icelandic government has held majority stakes in two of the three principal banks. Landsbankinn is 98.2% state-owned, and while the Minister of Finance and Economic Affairs has initiated the process of divesting the government’s shareholding in Íslandsbanki, significant public ownership remains. This reflects the country’s post-2008 financial restructuring and is relevant context for understanding the sector’s governance and stability.

The 2008 financial crisis. When Iceland’s banking system imploded during the 2008 global financial crisis, the government chose to allow the banks to fail rather than mount a bailout, subsequently securing emergency financing from the International Monetary Fund (IMF). Deposits held within Iceland were guaranteed in full by the government. The banking system that emerged from this period is widely regarded as stable and properly regulated, but the events of 2008 continue to shape the country’s regulatory philosophy and are an important part of the backdrop to the current financial landscape.

How do I open a bank account in Iceland as an expat?

The process of setting up a bank account in Iceland is straightforward, even for those who have just arrived. The first requirement is an Icelandic identification number — the kennitala — without which no bank will accept your application. If you do not yet have one, your initial task is to register with Registers Iceland. The steps below walk through the entire journey from arrival to having a fully operational account. Always refer to the individual bank’s current guidance and to the Central Bank of Iceland for up-to-date requirements, as procedures can change.

1. Obtain your kennitala (Icelandic ID number).

   The kennitala is your official Icelandic identification number, used for tax payments, banking, legal transactions, and everyday services such as gym memberships. Foreign residents are required to apply for a kennitala in person. EU nationals can register directly with Registers Iceland (Þjóðskrá), while those arriving from outside the EEA must go through the Directorate of Immigration. You will need to bring your passport and confirmation of your registered Icelandic address. Full guidance is available at skra.is.

2. Set up your Icelandic address.

   A registered residential address in Iceland is a prerequisite for obtaining a kennitala and, by extension, for opening a bank account. If you have not yet moved to Iceland or found a place to live, you will need to wait until you have done so before beginning the banking process. Arranging accommodation and completing your address registration must come first.

3. Obtain an Icelandic electronic ID (rafræn skilríki).

   Once your kennitala is in place, you can apply for an electronic ID, which is stored on the SIM card of your mobile phone. This credential enables you to carry out a wide range of official transactions digitally, including opening a bank account. Electronic IDs can be activated through mobile network operators or through a bank. Since the electronic ID requires an Icelandic SIM card to function, many people find it most convenient to obtain it via a mobile phone provider.

4. Gather your documents.

   When applying to open a bank account in Iceland, you will typically need: a valid government-issued photo ID such as a passport or driving licence; proof of your Icelandic address, for example a utility bill or a residence certificate; and your Taxpayer Identification Number (TIN), which for Icelandic residents is the kennitala. If you are arriving from a country outside the EEA/EFTA, you will also need to provide a valid residence permit.

5. Choose your bank and apply.

   With your kennitala secured, there are two routes to opening an account. If you have an electronic ID, you can download the bank’s app and complete the entire process digitally — including opening an account, ordering a debit card, and setting up a savings account or investment products. All three major banks accept online applications, though if you do not yet have an electronic ID, you may be required to attend a branch in person to sign your account agreement.

6. Activate your account and set up online banking.

   Once your account is live, activate online banking and install the bank’s mobile app. All three major banks offer English-language interfaces across their digital platforms. Configure direct debits for rent and utilities as soon as possible — in Iceland, virtually all regular payments are handled digitally, and having these arrangements in place early will simplify your day-to-day finances considerably.

There are no minimum deposit requirements widely reported for standard current accounts at the main Icelandic banks, although prepaid credit card products do require an upfront deposit as security. Verify current terms directly with whichever bank you choose. For regulatory guidance, consult the Central Bank of Iceland.

What banking and payment apps are widely used in Iceland?

Iceland’s digital banking infrastructure is among the most developed in the world and is embraced by the vast majority of residents. Banks have deliberately shifted their focus towards electronic self-service channels as demand for digital payments and online transactions has grown sharply over recent years. Each of the three major banks offers its own mobile app, supporting everyday payments, savings management, card controls, and international transfers.

Auðkenni (Electronic ID app). Once you hold a kennitala, you can obtain an electronic ID stored on your Icelandic mobile phone’s SIM card, which authenticates your identity for a broad range of official online activities including banking. Auðkenni is the national electronic identity solution underpinning access to banking platforms, government services, and tax systems — it sits at the heart of digital life in Iceland and is something every resident will need to set up.

International fintech apps. Platforms such as Wise and Revolut are used by many people living in and visiting Iceland. They are particularly well-suited to handling multi-currency expenditure, sending money abroad at competitive exchange rates, and managing finances that span more than one country. It is important to note, however, that neither Wise nor Revolut holds an Icelandic banking licence, meaning deposits held with them fall outside the protection of the TIF guarantee scheme. For receiving salaries, paying direct debits, and managing core Icelandic financial commitments, a locally licensed bank account is essential.

PayPal is available to users in Iceland and is accepted by a range of online retailers, although it has not achieved the same level of integration into everyday local commerce as Visa and Mastercard card payments. Foreign credit and debit cards linked to these major networks are accepted at most businesses that take card payments throughout Iceland.

If comprehensive banking services — including deposit protection, lending, and robust account management — are a priority, choosing a fully licensed bank is the appropriate course of action. Many fintech and e-money providers can handle straightforward tasks such as currency exchange and money transfers efficiently, but for more substantial financial needs, an institution holding a full banking licence is the right choice. All licensed banks operating in Iceland are regulated by and listed with the Central Bank of Iceland.

How can expats manage money between Iceland and their home country?

All three major Icelandic banks facilitate international transfers through their online banking platforms and branch networks, supporting SWIFT payments so that you can send and receive funds globally. That said, bank-to-bank international wire transfers frequently carry fees that can accumulate significantly over time.

Icelandic banks typically levy charges on outgoing international payments. As a rough indication, Landsbankinn charges approximately 900 ISK for international transfers made through its online banking platform (based on a recent fee schedule — always verify the current tariff directly with the bank). Fees differ across institutions and are subject to revision, so checking the latest schedule before making a transfer is worthwhile.

Alternative transfer services. A considerable number of expats resident in Iceland turn to services such as Wise (formerly TransferWise) or comparable international money transfer platforms when sending funds across borders. These providers generally apply the mid-market exchange rate and charge lower fees than conventional bank wire transfers. They are accessible to Icelandic residents subject to standard identity verification requirements. When evaluating any transfer option, compare the complete cost — factoring in both the explicit fee and the exchange rate margin applied — rather than focusing on fees alone.

Currency considerations. Iceland’s currency is the króna (ISK), and cashless transactions are the norm throughout the country, including in rural areas. The ISK sits outside the eurozone, and exchange rates shift over time. If you regularly send money between Iceland and a eurozone country or elsewhere, monitoring rate movements or using forward contracts may help you manage currency exposure. Services like Wise allow you to hold and convert multiple currencies within a single account.

Reporting requirements. As an EEA member state, Iceland participates in international financial transparency frameworks including the Common Reporting Standard (CRS) and, for individuals with US connections, the Foreign Account Tax Compliance Act (FATCA). If you hold accounts across multiple countries, you may have disclosure obligations in both Iceland and your country of origin. For guidance on Icelandic tax matters, visit Skatturinn (the Icelandic Directorate of Internal Revenue). For rules relating to foreign account holdings or large transfers, consult the Central Bank of Iceland for current guidance, as thresholds and obligations can change over time.

There is no obligation to close your existing home country bank account when moving to Iceland, and in many cases retaining it is sensible — particularly if you still have financial commitments there. Keeping accounts in both countries is a practical arrangement, especially during the early phases of your relocation.

Frequently Asked Questions

Can I open an Icelandic bank account before I move to Iceland?

Non-EEA/EFTA citizens must apply for a kennitala (ID number) in person, meaning the process generally cannot begin until they have physically arrived in Iceland. If you want some financial provision in place before your local account is set up, consider opening an account with an online platform such as Wise or Revolut to cover you in the interim. EEA citizens follow a somewhat simpler route, as they can apply for their kennitala directly through Registers Iceland rather than having to go via the Directorate of Immigration.

What is a kennitala and why do I need one?

The kennitala is your official Icelandic identification number, required for everything from paying taxes and banking to signing legal documents and using everyday services. Every Icelandic bank requires applicants to hold a kennitala before an account can be opened. It serves as the essential key to all formal financial and government services in Iceland, fulfilling a role comparable to that of a National Insurance number in the UK or a Social Security number in the United States.

Are there any restrictions on foreign nationals opening bank accounts in Iceland?

There are no restrictions barring foreign citizens from opening a bank account in Iceland. You will, however, need a kennitala and a registered Icelandic residential address. If you are arriving from a country outside the EEA/EFTA, a valid residence permit is also required. Banks may ask for supplementary documentation from non-EEA residents as part of their standard due diligence process.

Are my deposits protected if an Icelandic bank fails?

Deposit protection in Iceland is provided by Tryggingarsjóður (TIF), the Icelandic deposit and investor guarantee fund. The guarantee is aligned with EU models and covers up to €100,000 per depositor per bank (as of 2024), applying to both individuals and legal entities. For the most current information on coverage limits and eligibility, visit tif.is.

Do Icelandic banks offer services in languages other than Icelandic?

All three major banks provide English-language interfaces on their websites and digital platforms. Landsbankinn goes further, offering its app and online banking in Icelandic, English, and Polish. English-speaking customer support is available at all three institutions, making them reasonably accessible to those who do not yet speak Icelandic.

Can I use Revolut or Wise in Iceland instead of a local bank account?

Both Wise and Revolut function in Iceland and are genuinely useful for international money transfers and multi-currency spending. However, neither can replace a locally licensed bank account. Since all Icelandic employers pay salaries directly into domestic bank accounts, you will need a local account to receive your wages. Additionally, deposits held with fintech providers are not covered by TIF deposit protection in the same way that funds in a licensed Icelandic bank are.

What are bank opening hours in Iceland?

Bank branches across Iceland are generally open Monday to Friday, from approximately 09:00 to 16:00. Weekend and public holiday opening is not standard practice. That said, online and app-based banking is available around the clock, which means branch visits are rarely necessary for everyday financial tasks. Always confirm your specific branch’s hours with the bank directly.

Is Iceland a cashless society?

Iceland is one of the most cashless societies in the world. Card and mobile payments are accepted virtually everywhere, including at businesses in rural and remote areas. While situations where cash might be preferred can occasionally arise, day-to-day life in Iceland is entirely manageable without ever using physical notes or coins. Getting a working debit card linked to a local account should be among the very first things you arrange after arriving.

Who regulates banks in Iceland and where can I get official information?

The Central Bank of Iceland, a state-owned institution with independent governance, is responsible for maintaining price and financial stability and overseeing secure financial operations. It manages Iceland’s international reserves and ensures the effective functioning of both domestic and international payment systems. For regulatory guidance and consumer information, visit cb.is. For details on deposit guarantee coverage, visit tif.is. For information on tax obligations and reporting, consult Skatturinn.