British Museum gold coins

Weekend in Iceland Without Cash – Iceland’s cashless society

Posted on Posted in Iceland, Travel Tips
Cashless Iceland
Do not toss coins in the steam but could be used for the cashless society in Iceland

The airport ATM accepted my card, password and request for cash but then spit out the paper saying it couldn’t give me cash!  I initially thought at 6:30 a.m. maybe the machine was empty so I tried the other machine, same result – no cash.  Not worrying too much, I planned to find an ATM and/or bank in Reykjavik once I got settled at the hotel.  Little did I know I had entered a cashless society!

Finding the nearest ATM with the Plus sign was easy (around the corner from hotel). I waited for the lady ahead of me to finish her transaction and when I saw the machine spit out cash, I was relieved that I would soon have Icelandic Króna to add to my collection but also to spend this weekend on incidentals like breakfast, snacks, water, etc.. Going through the ATM motions, I had my hand ready to take my cash dispensed, except, nothing came out except the paper saying it couldn’t process my transaction.  I now realized that I would be calling my bank to see what the heck was going on – the fact that they are on speed dial isn’t good as they’ve stranded me in many countries without cash access.


A Bit of Foreshadowing

Prior to my trip, on the way to the airport, I called my bank to give them the whole “I’m going to this, that and the other country” so they could allow my ATM card to work.  They have consistently shut off my ATM card when I travel despite the travel notes, despite the fact that I travel internationally for business, etc. Just this past June they denied me money in London and I spent more than an hour to get that fixed.

This was the most frustrating call (almost 20 minutes) as my friend drove me to the train.

  • Did I know it was an ATM card? Yes, I am aware of what I have in my hand
  • It wasn’t a Debit card?  Yes, I know ATM only, rare but more secure than a debit card, in my opinion

I was then asked all the “security questions” followed by another set of questions to establish my identity –

  • What was my bank account number?  Um, I don’t have the bank statement with me, just my ATM card in hand. WRONG!
  • What was the last deposit date & amount?  Two weeks ago, about $200 from my Mom – WRONG!
  • What was the amount of my last payroll?  Wait was this a 3rd week pay?  what was deducted?  Who knows to the penny? WRONG!
  • What was the last ATM withdrawal – how much and where?  I got part of this right but overall was WRONG!
Grillmarket Bar
Without cash how would I buy drinks at the bar?

Seriously?  I was crazy in the car answering the most inane questions (I’m sure this recording will be used to train others in how to deal with hostile customers on the way to the airport who can’t give out personal information in public places and just want ATM access to get cash). Who really knows all of this info when asked?  I told the lady to call my branch who had just called this morning to survey how happy I was with their bank! Based on this conversation, I wasn’t happy and might now change banks! So then she went to the next layer of security questions since I failed the ones above, she was trying to verify that I was me, I could be someone who stole the ATM card she said. (Really and then what?  I decided to steal an ATM card and go to Iceland to use it?????  Yes, let me steal the card, call the bank to get them to allow access in Iceland, rather than hit the local branch and drain the account? – Seriously?)  When I replied “I don’t have a dog”, “I never lived in Sydney”, “I don’t have a cat”, “I didn’t pay a hospital bill”, etc. my friend wondered aloud what the hell was going on?


We Don’t Like Cash

So back to Iceland, I went back to the hotel to call the bank, they denied it was their fault, did I look for a PLUS sign (really?  I think I know how to use an ATM, I’ve been using them since before you were born!).  I gave up and went to the front desk to ask about other ATMs to try, the young guy looks at me and says “We don’t like cash, it’s too heavy with coins and such, everyone takes credit and debit cards without issue, unless they can’t get wi-fi”.  Hmmm, no cash for the whole weekend?  I was a bit skeptical so tried the credit card at the 10-11 (their version of 7-11 open 24/7) and it was no problem to put my chip and sign card in for the $6 purchase (no minimums, no huffs/puffs like in the U.S.).

Cafe in Reykjavik Iceland Cashless
Eating and drinking in a cashless society in Iceland is quite easy

Feeling almost naked without some local currency, I continued to use my credit card all weekend without any problems.  Merchants large and small happily accepted credit cards.  It was me trying to get over the “must have cash for small purchases, need cash safety net in case credit card doesn’t work, tip money (no tipping in Iceland)”. The biggest test came at the waterfall snack truck, surely this small vendor out in the middle of nowhere would be cash only?  Nope, there was the credit card machine and I bought two bottles of water for $5.

The Honor System

Surprisingly, it was the church that snarled my cashless weekend!  The ticket booth was on lunch so there was a barrel to put your cash in on an honor system (hey, it’s a church, not quite the place to pretend to pay) before you went to the observation tower.  I had no króna but no worries, this being the church, they had a handy-dandy conversion ready for you (fx in their favor, of course) and luckily I had a 5€ note on me to deposit. I always carry Euro, US and GBP notes and coins.

Iceland Cross on Church
You can’t lie in church, thankfully had Euro to contribute

The Cashless Society in Iceland

Spending the whole weekend without using cash was strange at first, I grew up traveling with American Express Travelers Checks, then buying currency ahead from Thomas Cook, before moving to my ATM card for cash. Cash is my security blanket.  I’ve read about cashless societies but didn’t think it could work given all the fees involved for the small businesses (or for those countries like Australia that pass the 2-3% processing fee to the traveler).  My credit card bill has Iceland transactions as small as $2.84 (my Golden Circle cookie) and the best part is that I earned points for it all. Traveling the weekend in and around Reykjavik without cash was at first scary but they have created a cashless society and it turned out to be pretty cool to experience.

Glacier Lake Iceland
Glacier Lake Iceland – free to hike and visit nature

Have you experienced a trip without using cash?  Are there other cashless societies out there I need to visit?

6 thoughts on “Weekend in Iceland Without Cash – Iceland’s cashless society

  1. We also got by in Iceland with very little cash (silly us – took ~$50 in krona from the airport ATM “just in case” and had to find ways to spend it before leaving!). I doubt I’ve been anywhere as credit card friendly as Iceland but I do use cards frequently in the USA as well. I can often go 2 weeks or so without spending anything in cash.

    1. In the US it is almost cashless (I still need to tip car valet) for the everyday resident but for my international travelers I still need to give them cash for tips at hotel and small merchants that won’t take credit cards. the tipping culture will prevent us from ever truly being cashless IMO

  2. Thinking cashless is our saviour is naive in my opinion.
    I have 3 major concerns with this trend:
    #1) many people, especially those on low incomes, find it hard to budget and control spending on cards – in times of economic crisis people always turn to cash for that;
    #2) the government will be able to monitor not only our payment choices but our every move. If the government or bank take away your card, what happens then if cash has gone? And what happens if the bank systems go down as they do sometimes?
    #3) costs will go up – Visa and MasterCard do not succumb to rules and regulations, they are public companies out to make a profit. Cash is their main competitor and once it has gone, prices will go up.

    1. Debbie –

      Interesting points in your comment – I wasn’t advocating “cashless” but rather telling my story of a weekend in Iceland and surviving without local currency when I grew up thinking I only needed cash to travel with (I always have a little Euro, US and GBP as backup). In Iceland where the total country population is about 300,000 and their Krona rates would require you to carry 20,000 or more (about $150), credit/debit cards do work. Cashless works in their society – cashless as saviour is not my opinion.
      I agree that some folks (at all income levels) find it hard to budget and prefer cash, I actually state in many posts that credit cards are only for those who can pay the balance off in full every month. As for the government interference, that’s a political discussion best left for many drinks at the pub.
      I agree that costs will go up, I’ve already seen and experienced that in Australia when the hotel passes the Visa transaction fee 2-3% to me, as if I have $1000 AUS on hand to pay the bill to avoid the fee. Many countries at least in Europe are better advocates of using cash and not credit, unfortunately in the US, that’s not the case with all of the “free” stuff to get with every credit card signup.

  3. Thanks for this post! I feel a bit better about not having to convert or even bring much cash with me. Seriously, the US should pick up this system.

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