If you have an Icelandic employer or if you are living in Iceland, it is recommended to open a bank account for day-to-day transactions, especially if the stay exceeds six months. Access to an Icelandic bank account will enable you to receive salary payments and handle your finances.
For convenience most employees choose to have their paychecks directly deposited.
Ask about the different services offered by banks before deciding which one offers an account that is best suited to your needs, offers the best rate of return and has the lowest service charges. Some banks offer better interest rates than others on your savings.
Your host institution could provide good advice regarding which bank could provide the best services for you.
There are a number of banks to choose from. The Banks have different policies and characteristics. Euraxess Iceland is not affiliated with any banks, however, here's a list of the main Icelandic banks with information in English:
To open a bank account you need an Icelandic ID number (kennitala) and an address in Iceland. You must apply for an ID-number at the Icelandic National Registry (Þjóðskrá).
You may have to show up to the bank personally to sign the account agreement. In some cases opening bank accounts can be done fully electronically.
If you must be present in person remember to bring the relevant documents, such as your passport. For some nationalities additional documentation may be required. You may be asked if you plan to transfer money out of Iceland.
Most banks attach a VISA or Mastercard debit card to your bank account. You will receive the VISA card and your PIN code separately by post. To apply for a credit card you may have to document employment and salary.
When you move from Iceland you should return your bank card. Usually you have to pay an annual fee to keep the card even if the account is 0,-. You can still keep your bank account and internet bank.
Registers Iceland (Þjóðskrá Íslands)
Borgartúni 21 150 Reykjavík
Telephone: (+354) 515 530
E-mail: skra@skra.is
- All banks offer online banking which allows you to transfer money and pay bills.
Mortgages
Most people finance the purchase of real-estate property and housing construction with mortgages, and it is recommended to compare options to see the terms available.
Borrowing options
- Mortgages are offered by various credit institutions:
Commercial banks and saving banks,
- Most credit institutions require a payment ability evaluation with loan applications.
- The payment ability evaluation is a calculation of the borrower's ability to pay and the person's borrowing needs; an assessment of how expensive a property the person in question will be able to buy based on the value of their assets, income and expenses.
- Borrowers with the Housing Financing Fund will be able to prepare their own evaluation of their ability to pay online, or they can receive assistance with this over the telephone or at the Fund's facilities. Other lenders usually prepare the evaluation of payment ability for their customers.
- The Housing Financing Fund offers loans to individuals to buy, construct or make improvements on their own accommodation. The residents of Iceland have the same right to obtain the Fund's housing loans, regardless of where in Iceland they live.
- The Housing Complaints Committee decides on disputes regarding the decisions of the Housing Financing Fund.
About housing loans
- All house-purchasing loans are mortgages, which means that they are secured with a mortgage in the property to be purchased or in other real-estate properties.
- When a decision is being made as to how large a mortgage will be granted for a house purchase, the reference points is the borrower's payment ability, the price of the property and the payment burden ratio
- . Lenders will also view the assessment of the property to be purchased or mortgaged.
- The payment load of the loan, meaning the value of installments, is determined by the interest on the mortgage and the repayment term.
- If payment difficulties arise it is possible to seek advice and remedial action from
- The Housing Financing Fund,
- credit institutions,
- social services of local communities, and
- The Debtor's Ombudsman
Remember
- Get information on different borrowing options and interest rates from the Housing Financing Fund, banks and other credit institutions.
- It is possible to prepare an evaluation of payment ability through the Housing Financing Fund website, if you want to check your purchasing power.
- Seek remedial action from the creditor or from other advisors as soon as possible if any payment difficulties arise.
Links of interest
Laws and regulations