Banks in Iceland

The four commercial banks in Iceland are Arion banki, Íslandsbanki, Kvika banki and Landsbankinn. The savings banks are indó sparisjóður and Smári sparisjóður. Payment institutions and electronic-money institutions are regulated separately and can provide selected payment services without being full banks. Seðlabanki Íslands combines central-bank and financial-supervision functions. It licenses and supervises financial institutions, oversees payment systems and provides consumer guidance. The core domestic payment and settlement infrastructure includes MBK, Reiknistofa bankanna and Auðkenni. Nasdaq securities settlement is adjacent to banking and mainly concerns investment transactions rather than ordinary accounts and payments. A national identification number, called a kennitala, is usually needed to open an account. EEA and EFTA citizens generally obtain registration through Registers Iceland, while other applicants use the applicable immigration and residence-permit process. A bank may open an account online or in a branch with valid identification. It checks identity, the purpose and source of funds, tax residence and tax identification information, and may request politically exposed person and anti-money-laundering information. The bank can restrict account access if required information is not provided or regularly updated. Consumers with legal residence in the EEA must generally be offered access to an ordinary payment account by a bank or savings bank, subject to customer due diligence and other legal conditions. This Icelandic account type is commonly described as an almennur greiðslureikningur. It supports salary payments, transfers, direct debits, cash deposits and withdrawals, and usually a debit card. An innlánsreikningur is a deposit or savings account; fixed-term and indexed savings products may have different withdrawal conditions. A debit card normally belongs to the payment account rather than the savings account. Youth access and age limits are set by the individual bank. An overdraft is optional credit and belongs to the separate debt boundary, not to the basic payment function. The domestic currency is the Icelandic króna, or ISK. Common payment methods include domestic transfers, direct debits, standing orders and card payments. Electronic channels are dominant, while cash remains available through branches and ATMs where offered. Euro transfers within the European payment area can use SEPA; transfers in other currencies or to other destinations commonly use SWIFT. Banks use IBAN and BIC details, and foreign-currency transfers may require purpose classification or reporting to Seðlabanki Íslands. Iceland has no single national bank-fee tariff, so transaction, card, cash and service charges should be compared in each bank's tariff. A switching service can assist with moving payment arrangements, but the receiving and former providers' deadlines and terms still apply. Debit, credit and prepaid cards may support online payments, contactless payments and mobile wallets. Apple Pay or Google Pay availability depends on the bank and card. During the network outage in force since 1 July 2026, physical cards using chip insertion and PIN are the fallback for essential purchases, with a baseline limit of ISK 50,000 per adult card; an issuer may set a higher limit. Phones and watches are excluded from that fallback. Keep the PIN secret and contact the issuer immediately if a card is lost or misused. Eligible deposits are protected by Tryggingarsjóður vegna fjármálafyrirtækja up to the equivalent of EUR 100,000 in ISK. This protection concerns eligible bank deposits, not investments. Holding balances with several providers can spread exposure as a personal risk practice, but it does not increase the legal coverage limit for one eligible claim. Netbanki means online banking, and Icelandic banks commonly provide online banking and mobile apps around the clock. Rafræn skilríki are electronic identification credentials used for strong authentication and electronic signatures. Auðkenni SIM-based identification requires an Icelandic phone number. The Auðkenni app can work with a non-Icelandic number when its self-service requirements are met, including an Icelandic passport, age 18 or above and an NFC-capable device. Biometric confirmation is optional where the service supports it. Banks offer branches, telephone service, secure chat, email and in-app support. A written complaint normally goes to the bank first. For payment services, the provider generally has no more than 15 weeks to issue a response. If the bank rejects the complaint or does not resolve it after four weeks, the customer can submit a written complaint in English or Icelandic to the Complaints Committee on Transactions with Financial Firms; a fee may apply. Seðlabanki Íslands can provide guidance or receive notifications but does not decide an individual's private claim. Civil court remains available. Strong customer authentication helps protect digital banking. Approve an electronic-ID request only while actively carrying out the matching transaction. A bank or payment institution does not request a password, PIN or security code through email or SMS. Freeze or block a compromised card, contact the bank and report suspected fraud to the police. A chargeback may be possible for an undelivered card purchase after contacting the merchant, while an outbound or international transfer is often harder to recover. Keeping only the required working balance in a payment account can limit losses.