The name króna means crown. It comes from the Latin word corona, which also means "crown". Many countries in the Nordic region, like Denmark, Sweden, and Norway, have currencies with similar names, such as the Danish krone or Swedish krona. This is because they were once part of a group called the Scandinavian Monetary Union.

The First Icelandic Krona (1874–1981)

The first money used in Iceland was the Danish krone, introduced in 1874. A few years later, in 1885, Iceland started printing its own banknotes.

Iceland's money became separate from the Danish krone after World War I. This was also when Iceland gained its independence from Denmark in 1918. The first Icelandic coins were made in 1922.

In 1922, the value of the Icelandic krona was lowered by 23% compared to the Danish krone. This was the start of Iceland managing its own money system, and the krona's value changed many times after that.

For 14 years, starting in 1925, the krona's value was linked to the British pound. Then, in 1939, it was linked to the US dollar until 1949.

Early Coins

The 10 and 25 aurar coins first made in 1922.

Iceland's first coins were 10 and 25 aurar (a smaller unit of money, like cents) pieces. They were made in 1922. Later, in 1925, 1 krona and 2 krona coins were added. In 1926, 1, 2, and 5 aurar coins were also made.

After Iceland became fully independent from Denmark in 1944, the designs on the coins were changed in 1946. The royal symbol was removed.

Because the krona's value dropped a lot, new coins were introduced starting in 1967. This included 10 krona coins, then 50 aurar and 5 krona coins in 1969, and 50 krona coins in 1970.

Early Banknotes

A 5 krónur banknote from 1928, issued by the Landsbanki Íslands.

The first banknotes were printed in 1885 by Landssjóður Íslands (Iceland's National Treasury). They came in values of 5, 10, and 50 krona. In 1904, a new bank, Íslands Banki (Bank of Iceland), started printing money and added 100 krona notes.

In 1921, another government body, Ríkissjóður Íslands, began issuing paper money, with notes for 1, 5, 10, and 50 krona.

By 1928, the Landsbanki Íslands (National Bank of Iceland) took over printing notes of 5 krona and higher. The Ríkissjóður Íslands continued to print 1 krona notes until 1947. The Landsbanki Íslands introduced 500 krona notes in 1935, and then 25 and 1000 krona notes in 1957.

In 1961, the Seðlabanki Íslands became the main bank of Iceland. It started printing paper money in values of 10, 25, 100, and 500 krona. These notes were made in England.

The Second Icelandic Krona (1981–Present)

In 1981, Iceland changed its money system because of high inflation (when prices go up a lot). This change meant that 100 old krona were now worth 1 new krona. A new 500 krona banknote was released in 1981. Later, 1000 krona notes came out in 1984, and 5000 krona notes in 1986. A 2000 krona banknote was introduced in 1995, but it was not very popular. The 10,000 krona banknote was released in 2013.

Coins worth less than one krona (aurar) have not been used for many years. In 2002, the Prime Minister of Iceland decided that all payments should be in whole krona. Coins worth less than one krona were taken out of use. By 2007, the eyrir (aurar) officially stopped being a part of the Icelandic krona.

Modern Coins

In 1981, new coins were made in values of 5, 10, and 50 aurar, along with 1 krona and 5 krona. Later, 10 krona coins were added in 1984, 50 krona in 1987, and 100 krona in 1995. Since 2003, banks in Iceland no longer accept aurar coins.

Currently circulating coins
Value	Technical parameters				Description			Issued since
Value	Diameter	Thickness	Mass	Composition	Edge	Reverse	Obverse	Issued since
1 kr.	21.5 mm		4.5 g (until 1989) 4.0 g (from 1989)	Cupronickel 75% Cu, 25% Ni (until 1989) Nickel-plated steel (from 1989)	Milled	Mountain giant	Atlantic cod (Gadus morhua)	1981
5 kr.	24.5 mm		6.5 g (until 1996) 5.6 g (from 1996)	Cupronickel 75% Cu, 25% Ni (until 1996) Nickel-plated steel (from 1996)		Land wights	Two short-beaked common dolphins (Delphinus delphis)	1981
10 kr.	27.5 mm	1.78 mm	8.0 g (until 1996) 6.9 g (from 1996)			Land wights	Four capelin (Mallotus villosus)	1984
50 kr.	23 mm	2.6 mm	8.25 g	Nickel brass 70% Cu, 24.5% Zn, 5.5% Ni	Milled	Land wights	Shore crab (Carcinus maenas)	1987
100 kr.	25.5 mm	2.25 mm	8.5 g	Nickel brass 70% Cu, 24.5% Zn, 5.5% Ni	Alternately plain and milled	Land wights	Lumpfish (Cyclopterus lumpus)	1995
For table standards, see the coin specification table.

Former circulating coins
Value	Technical parameters				Description			Issued since	Date of lapse
Value	Diameter	Thickness	Mass	Composition	Edge	Obverse	Reverse	Issued since	Date of lapse
5 a	15 mm		1.5 g	Bronze 97% Cu, 2.5% Zn, 0.5% Sn	Plain	Bird	Common skate (Raja batis)	1981	1 October 2004
10 a	17 mm		2.0 g	Bronze 97% Cu, 2.5% Zn, 0.5% Sn		Bull	Squid (Cephalopoda)
50 a	19.5 mm		3 g (1981) 2.65 g (1986)	Bronze 97% Cu, 2.5% Zn, 0.5% Sn (1981) Copper-plated steel (1986)		Dragon	Shrimp (Pandalus borealis)
For table standards, see the coin specification table.

Modern Banknotes

Icelandic banknotes show the dates of the laws that allowed them to be made. In 1981, notes of 10, 50, 100, and 500 krona were issued. Then, 1000 krona notes came in 1984, and 5000 krona notes in 1986.

In 1994, 100, 500, and 1000 krona notes were reissued with new designs. In 1995, a new 2000 krona note was released. This 2000 krona note looked a bit different from the others.

In 2001, more changes were made to the banknotes. Features like special printing patterns and tiny text were added to more notes. The 1000 and 5000 krona notes also got shiny metallic parts next to the pictures.

In 2013, a new 10,000 krona banknote was introduced. It features the scientist and poet Jónas Hallgrímsson and the Eurasian golden plover bird. Notes of 100 krona or less are no longer used, as the central bank has taken them out of circulation.

Law of 29 March 1961 Series
Value	Dimensions	Main Colour	Description			Date of issue
Value	Dimensions	Main Colour	Front side	Back side	Watermark	Date of issue
10 krona	130 × 70 mm	Blue	Arngrímur Jónsson the Learned	Old Icelandic household scene based on Auguste Mayer's drawing	Jón Sigurðsson	1981
50 krona	135 × 70 mm	Brown	Guðbrandur Þorláksson	Printers at work in the 16th century
100 krona	140 × 70 mm	Green	Árni Magnússon	Monastic scribe
500 krona	145 × 70 mm	Red	Jón Sigurðsson	Jón at his writing desk
1000 krona	150 × 70 mm	Purple	Brynjólfur Sveinsson	Brynjólfskirkja church (1650–1802) at Skálholt		1984
5000 krona	155 × 70 mm	Blue-green multicolour	Ragnheiður Jónsdóttir	Ragnheiður instructing two girls in embroidery		1986
Law of 5 May 1986 Series
100 krona	As previous					1994
500 krona
1000 krona
2000 krona	150 × 70 mm	Brown	Jóhannes Kjarval	Kjarval's painting Yearning for Flight and his drawing Woman and Flowers	Jón Sigurðsson	1995
Law of 22 May 2001 Series
500 krona	As previous, but the underprint design extends upward and downward to fill the margin					October 2005
1000 krona						November 2004
5000 krona						November 2003
10,000 krona	162 × 70 mm	Blue	Jónas Hallgrímsson; outlines of mountains Háafjall and Hraundrangi formed from Icelandic words coined by Jónas; floral pattern from cover of periodical “Fjölnir;” Jónas’ handwritten poem “Ferðalok” (Journey's End); topographical outline of mountain Skjaldbreiður	A plover and Hallgrímsson's poem Skjaldbreiður Mountain; topographical outline of mountain Skjaldbreiður; Jónas’ handwritten poem “Fjallið Skjaldbreiður;” scallop shell	Jón Sigurðsson	October 24, 2013

Challenges for the Icelandic Krona

Iceland is not part of the European Union and does not use the euro. The Icelandic krona is a currency that is not used much around the world. Its value can change quickly compared to other currencies like the US dollar or the euro. For example, in 2006, the krona's value against the US dollar changed a lot.

Before a big financial crisis in 2008, many thought the krona was worth too much.

In most shops in Iceland, you pay with electronic cards. Other currencies are almost never accepted, except at Keflavík International Airport. Some stores in downtown Reykjavík might accept foreign money.

Iceland uses computers and technology a lot. Many payments are made electronically, like with debit or credit cards. The largest banknote, the 10,000 krona note, is not worth a huge amount (about $72 US dollars in August 2024). This means most big payments in Iceland are done electronically or using other currencies.

The 2008 Financial Crisis

How the Icelandic krona's value changed against the euro from 2000 to mid-2010.

In October 2008, Iceland had a major financial crisis. The value of the Icelandic krona dropped very quickly. The Central Bank of Iceland tried to keep its value steady against the euro, but they had to give up. The krona's value fell even more.

This crisis made things much cheaper for foreign visitors and businesses. For example, in July 2008, a Big Mac burger cost almost $6 US dollars in Iceland, but only $3.57 in the US.

Iceland and the Euro

Some people think that if Iceland used the euro, it would help the country avoid big changes in its money's value. Before the crisis, some economists thought the euro could bring lower interest rates, which would help businesses grow. It might also make prices lower by making it easier to compare costs with other countries that use the euro.

There are different opinions in Iceland about using the euro. Some polls have shown that many Icelanders would like to adopt the euro, while others are against it. After the financial crisis, some officials said that the krona was "dead" and that the euro was the only real choice.

In 2009, Iceland's parliament voted to apply to join the European Union, which would mean adopting the euro. However, this application has been paused since 2013. As of 2015, Iceland has no plans to continue joining the EU or to adopt the euro. The current government leaders have said the krona will remain Iceland's money for now.

Using Another Country's Money

Some small countries, like El Salvador, have decided to use another country's money (like the US dollar) to help control inflation. This means they lose control over their own money policies.

In 2012, there was talk about Iceland using another country's money. The idea of using the Canadian dollar was popular because Canada is also a northern country with a similar economy. However, officials from the Central Bank of Iceland said that using another currency would be very expensive and might not be the best choice unless joining the European Union was completely off the table.

As of 2018, Iceland does not plan to use a foreign currency.

Exchange Rate

As of August 31, 2024, 1 US dollar was worth about 138.40 Icelandic kronur.

Current ISK exchange rates
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Icelandic króna facts for kids

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What's in a Name?