Payment Systems in Norway and Options for Cross-Border Money Transfers

If you had to name one of the world’s top cashless countries, and you said Norway, you'd be on the money.

Like its fellow Nordic countries or the UK, Norway has a reputation for moving past cash and straight into a digital-first payments society.

So what are your best money transfer options in a country where only 4% of all transactions are made using banknotes and coins?

Let’s find out.

Cards

Bank cards (both credit and debit) are Norway’s most widespread method of payment, accounting for nearly 50% of all online transactions and 88% of all POS payments.

Card penetration is therefore high in Norway, with 2.7 debit cards and 1.6 credit cards per capita in 2020.

Norway has its own debit card scheme called BankAxept, which is widely used and accepted by most merchants in the country. Cards issued by BankAxept are co-branded with Visa and MasterCard so they can be used for international payments as well.

Sending money abroad from your Norway debit or credit card can be subject to considerable fees and waiting times depending on where and how you send.

For example, transferring money from a Norwegian card to a bank account in Russia takes one working day and can have a transfer fee of up to 10% - or even 20% if you want your recipient to receive cash instead.

With Fin.do, you can send money straight from card to card, in seconds, to and from any two countries that we support.

Bank transfers

Second most popular payment methods are bank transfers, which are forecast to account for a third of all payments in Norway by 2023. Coming from a country with a comparatively high degree of trust in banks (both established and challenger banks), this trend isn’t surprising.

Open banking solutions such as Trustly are on a path to wide adoption in Norway. It allows users to make money transfers online straight from their bank account, without having to use a card. In 2019, Norwegians had an average of 141 account-to-account payments per capita.

Norway, though not an EU member state, is a member of the SEPA zone. Bank transfers to and from any of the other 35 SEPA countries take as long and cost just the same as a domestic money transfer, as long as the transfer is made in euros and not a local currency.

This means that if you transfer money from the UK to Norway or from Norway to Poland (all SEPA members), if the payment is made in a local currency (GBP, NOK, or PLN), your national bank’s fees and transfer times continue to apply.

To send and receive money instantly without paying currency conversion fees or high bank fees, try Fin.do. With Fin.do, you can send and receive money within seconds in 50+ countries and 160 currencies, without having to create a new payment account.

Going mobile

With 99% internet penetration and 96% smartphone penetration, Norway is, for sure, a mobile-forward country.

Therefore, mobile payments are growing rapidly in Norway. At the beginning of 2021, mobile payments accounted for 12% of all POS payments, up from 8% in 2020.

Vipps is the country’s main mobile payment application and dominates the mobile money transfer market. Originally developed by DNB (Norway’s largest bank), the app is now available for customers of any Norwegian bank. Used for peer-to-peer transfers, online payments, and shopping, almost 80% of all Norwegians have used the app at least once.

Domestic peer-to-peer mobile payments are gaining traction in the Nordics (27% of consumers performed one at least once a week in 2018), but the same doesn't go for cross-border payments. 81% of people reportedly have never done an international mobile peer-to-peer transaction.

Fin.do makes it possible to seamlessly and instantly send money overseas, from card to card. You can make a transfer using nothing but your phone and send money straight to a contact or to a card number. Your recipient will get the money in seconds and will be able to use it right away.

Buy now, pay later

Consumer credit solutions such as Klarna, ViaBill, or AfterPay are also a common way to pay online in Norway.

They are an interesting option as they enable consumers to purchase any time they want but pay over time, often interest-free.

Going cashless

As mentioned before, hard cash is currently used in just 3 to 4% of all transactions in Norway, making it the lowest level of cash usage in the world. As such, ATM usage is declining in Norway, with an average of only 8 cash withdrawals per consumer per year.

Sending (or receiving) cash from Norway is therefore one of the least convenient ways to transfer money.

First, you need to find a money transfer service which has send and receive offices in your targeted locations. Second, waiting times can be long and you may not be able to send a different currency than the currency of your sending country. Also, your recipient is likely to have to wait several working days for the money to arrive.

And last but not least, in a country that’s moving past cash altogether, the benefits of holding cash don’t go a long way.

This concludes our tour of the payment methods in Norway. Fascinating, right?

Are you curious about our next destination? Stay tuned or suggest one in the comments below.

Happy transfers!

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