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Do I Need a Credit Card When I Rent a Car in Iceland?


Credit cards for Iceland car rental

When making arrangements for your Iceland vacation and booking everything, you may wonder exactly how to rent a car in Iceland. Is it different than in other countries? And can you use your debit card or do you need a credit card to rent a car in Iceland? Let’s look at some different scenarios of when you can use only a credit or debit card, or both. It’s important to know before you set out in order to have your trip run as smoothly as possible.

When to Use a Debit Card For Iceland Car Rental

After you’ve decided which model of car you’d like to rent and hammered out your trip dates, you’ll eventually need to make a booking. Standard procedure is to pay a small deposit or booking fee of around 15-20% of the cost of your rental. This is to secure the vehicle and make sure no one else can rent it. This payment can be made with a debit card or credit card and is refundable up to a certain point. Double check with your rental car provider, but if you cancel 15-30 days before your rental, there is no penalty and you get your deposit back. 

Some companies ask that you pay the remaining balance later on, but the majority of them will let you pay in full upon pickup of the vehicle. You can pay the cost for your Iceland car rental using a debit card or a credit card, whichever suits you best.

When to Use a Credit Card For Iceland Car Rental

When you pick up your vehicle, either at Keflavik Airport or at the Reykjavik city office, you’ll be asked to show your ID, driver’s license, fill out paperwork, etc. You’ll also need to present a valid credit card as a guarantee for your rental. In other words, you can’t use a debit card for this purpose. It doesn’t have to be the card used to make the booking, and it doesn’t even have to be a card belonging to the driver. As long as someone in your party can present a valid credit card at pickup, you’ll be fine. Most companies don’t block the card for any amount related to the rental, they just take the details in case something happens with the car during your trip. 

You’ll find that this is standard operating procedure at all of the car rental companies here. There was one that accepted debit cards, but they offer much older cards and no longer seem to be operating. If you absolutely do not have a credit card and no one in your party does either, some companies will make an exception. But in return, you’ll likely have to purchase the most comprehensive insurance coverage that they offer. Or have to leave a large deposit that pretty much equals their best insurance package.

The reason car rental companies in Iceland do this is to protect themselves from irresponsible renters. While most people are careful, respectful renters, there are a few bad apples who seem to think that they can “run away” if they did something they weren’t supposed to, like rack up a bunch of speeding tickets with a rental car or drive into a ditch. In case your mom never told you, the world doesn’t work that way, sorry. You do the crime, you do the time.

Do I Need a PIN For My Credit Card in Iceland?

Ok, so hopefully it’s clear when you can use a debit card or a credit card in Iceland when it comes to your car rental. You can use either to pay for the deposit or the rental and you have to leave credit card details as a guarantee for your car when you pick it up. 

But there’s something else to keep in mind. In Iceland, you don’t really need to bring much cash. They accept credit cards everywhere, which is fortunate. Something you may not know is that if you’re using a credit card at a gas station in Iceland, you’re required to use a PIN. Now, most people know the PIN to their debit card because they use it almost every day. But because we often have to sign with credit cards, we have no idea what the PIN is or if we even set one up. It’s entirely possible that your credit card may not have a PIN yet. Call your credit card company a few weeks before your Iceland trip to find out your PIN, or if necessary, set one up. They'll send it to you via snail mail, so allow some time for it to arrive.

Do I Need a Credit Card When I Rent a Car in Iceland?

So while you don’t need a credit card to pay for your Iceland car rental, someone in your party needs to provide one upon pickup of the vehicle. It’s just a precaution in case there are any unexpected charges that come up which are not covered by the rental insurance you choose. Have a safe trip and enjoy exploring Iceland.