How to open a bank account in Iceland from the UK?

Gert Svaiko

Planning a move to Iceland? It’s becoming a popular choice with expats, drawn there by its breathtaking natural landscapes, thriving economy and high quality of life.

Whether you’re moving there to work, study or simply to explore the country’s incredible scenery, you’ll need a way to manage your money in Iceland. A local bank account could be convenient, letting you get paid (if you’re working) and cover your bills.

But how easy is it to open a bank account in Iceland, and can you do it from the UK before your move?

Read on for everything you need to know. Our helpful guide will cover things like the documents needed to open an Icelandic bank account, banking fees and the main banks you can choose from.

And if you’re only moving or travelling to Iceland temporarily, consider checking out the Wise card – it’s designed for travellers to ease managing money abroad.


Please see the Terms of Use for your region.

How to open a bank account in Iceland as a foreigner?

There are no restrictions preventing foreign citizens from opening a bank account as a foreigner. However, all Icelandic banks require new applicants to have an Icelandic ID number known as kennitala. Everyone living in the country must have an electronic ID, as it’s needed for everything from banking to paying taxes.

Foreigners need to apply in person for their electronic ID.¹ People from EU countries can do this at the Registers Iceland, but those outside the EE/EEA will need to apply through the Directorate of Immigration.

Can you open a bank account in Iceland as a foreigner from the UK?

You can open an Icelandic bank account as a UK citizen, but you’re unlikely to be able to do it while you’re still in the UK.

This is because you need an electronic ID number to apply for a bank account in Iceland. And to get this, you need to provide your residential address in Iceland.

So if you’ve not yet moved there or found somewhere to live in Iceland, you’ll need to wait until you arrive.

Can you open a bank account online in Iceland?

Yes, it’s possible to open an Icelandic bank account online. But again, you’ll need to have your electronic ID number in order to do it.

Once you have your electronic ID, it should be a relatively quick and easy process to open your account online. Banks in Iceland have all embraced digital banking technology, so offer access to many of their services online.

📚 Read more: The best UK bank accounts for travelling and travel insurance

What documents do you need to open a bank account in Iceland?

While the requirements can vary from bank to bank, you’ll usually need to provide the following to open a bank account in Iceland:¹

  • Your electronic ID - this is stored in the SIM card on your mobile phone, so you’ll need to have a compatible SIM card. Once you have your kennitala ID number, you’ll be able to activate your ID through a bank or a mobile phone company.
  • Your passport
  • Your residence permit (as a citizen of a country outside of the EU/EEA).

Types of Icelandic bank accounts

Banks in Iceland typically offer two main types of account:

  • Debit accounts - these are the Icelandic equivalent of UK current accounts, designed for depositing your salary into. When you visit the bank’s website, you may see the option to apply for a debit card rather than an account. When you do so, you’ll get access to both the debit account and linked card.
  • Savings accounts - these come in many forms, including interest-paying currency accounts, fixed interest accounts, first home savings accounts and dedicated accounts for young people and retirees.

Which Icelandic bank is best for foreigners and expats?

There are three main banks for retail customers in Iceland. These are Íslandsbanki, Landsbankinn and Arion Bank.

Let’s take a look at each of these in turn, including what they have to offer for new arrivals.


With a history dating back to 1875, Íslandsbanki is a universal bank with 12 branches and a network of ATMs across the country.² It’s the second-largest bank in Iceland.

It offers services for both personal and business customers, with products including:²

  • Current/debit accounts
  • Savings accounts
  • Debit and credit cards
  • Loans, including mortgages, personal loans and car finance.


The largest bank in Iceland, Landsbankinn has roots dating back to 1886 - although the bank in its current form was established in 2008. The bank is owned by the National Treasury of Iceland.⁶

It’s a universal bank, offering services to both personal and business banking customers. It has a large network of branches and ATMs across the country, as well as offering digital banking services.

Its products include:⁷

  • Savings accounts
  • Payment cards
  • Loans, including mortgages, inflation-indexed and non-indexed loans, and car loans.

Arion Bank

The third-largest major bank in Iceland, Arion Bank provides services in three separate areas - retail banking, corporate/investment banking, and markets. It has 15 branches and service centres across the country.³

For retail customers, it offers services such as:³

  • Payment cards
  • Savings accounts
  • Loans, including mortgages and vehicle financing
  • Pension savings
  • Insurance.

Digital-only alternatives to banks

There are also a number of digital-only money management providers available in Iceland. These don’t have any physical branches, so you’ll usually manage your account online or through a mobile app.

This can be a convenient option, especially if you haven’t yet moved to Iceland and want to get an account set up. But just be aware that as these aren’t bank accounts, they may not offer the same protections, security and services.

Here are some of your options for digital-only accounts:

  • Wise
  • Bunq
  • N26
  • Revolut
  • Indo
  • Vivid Money.
📚 Read more: Online banks and alternative providers in the UK

What kinds of banking fees and charges can you expect in Iceland?

Wherever in the world you bank, there will always be some fees to watch out for. Below, we’ll run through the kinds of banking charges you can expect when you open a bank account in Iceland.

Account maintenance fees

While it can vary between banks, you can usually expect there to be some sort of annual charge for having an Icelandic bank account.

In most cases, you’re not likely to be charged an account maintenance fee on the account itself. But you will almost certainly pay an annual debit card fee. This can range from between 790⁴ to 950 ISK⁵, which is only around £4.78 to £5.75.

Payment charges

Icelandic banks may also charge some payment fees for one-off payments, direct debits and using your debit card.

These fees are typically very small, but they can add up. To give you an idea, here are the payment charges when you open an account with Landsbankinn:⁴

  • Payments made through online banking - 80 ISK (£0.48 GBP)
  • Debit card payments - 18 ISK (£0.11 GBP)
  • International payments through online banking - 900 ISK (£5.45 GBP).

Other fees to look out for

Depending on the bank, you may also be charged fees for:

  • Overseas card purchases and cash withdrawals
  • Bank services carried out in branches or service centres (it’s always recommended to carry out transactions online if you can)
  • Credit cards - these usually have an annual fee
  • Requesting a printed account statement.

Wise – Money for here, there and everywhere

A bank account isn’t the only way to manage your finances in a different country. Many expats, international students and digital nomads use Wise instead.

Wise is a money services provider, offering a multi-currency account, international money transfer services and a debit card.

Open a Wise account online and you can manage your money in multiple currencies and get a Wise card to spend internationally at the mid-market exchange rate.

Sign up with Wise today 🚀

Please see the Terms of Use for your region or visit Wise fees & pricing for the most up-to-date information on pricing and fees.

FAQ on how to open a bank account in Iceland

Still have questions about bank accounts and money in Iceland? Take a look below for a little more information.

Can I use online banking in Iceland?

Yes, online banking is the norm in Iceland, so you’ll have access to a full range of digital and in-app banking services.

Can I use my UK debit/credit card in Iceland?

You can use your UK card in Iceland, but watch out for the fees. UK banks tend to charge foreign transaction fees whenever you spend in a different currency. And if you’re using a credit card, you’ll almost definitely be charged a fee for any cash-based transactions, such as withdrawing money from an ATM.

Can I withdraw money from an ATM in Iceland?

Yes, you can use your debit card to withdraw cash from ATMs in Iceland, and you’ll find a decent network across major towns and cities. But just be aware that your bank may charge a small fee for debit card transactions.

And that’s it - all the essential info you need on how to open a bank account in Iceland from the UK. As long as you have that all important electronic ID number, you should find it reasonably easy to do.

There isn’t a huge amount of choice when it comes to banks, but then that could make it a little easier to select an account.

📚 Read more: Cost of living in Iceland

Sources used:

  1. Íslandsbanki - Banking in Iceland
  2. Íslandsbanki - Branches
  3. Arion Bank - About Arion Bank
  4. Landsbankinn - Interest rates and fees
  5. Arion Bank - Interest rates and fees
  6. Wikipedia - Landsbankinn
  7. Landsbankinn - Personal

Sources last checked on date: 29-Aug-2023

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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