The krone, which translates to “crown” in English, has been the official currency of Norway since 1875. It is also used in the country’s dependent territories and dependencies.
The krone is divided into 100 øre, although the last coins denominated in øre were withdrawn from circulation in 2012. The currency is available in both coins and banknotes, with coins ranging from 1 Krone to 20 Krone, and banknotes ranging from 50 Krone to 1,000 Krone.
This article takes a closer look at the history and development of the Norwegian krone, Norway’s official currency. We trace its journey from being a symbol of national unity to its current status as a stable and significant currency in the global financial market, highlighting how the krone’s story is closely tied to Norway’s evolution.
Historical Journey of the Norwegian krone
The Norwegian krone also known as ‘kr’, and sometimes distinguished as NKr, is the currency of Norway, including its overseas territories and dependencies. Once commonly referred to as the Norwegian crown in English, this term is now rarely used.
The krone, divided into 100 øre, saw its last øre coins withdrawn in 2012. As of April 2010, it ranked as the thirteenth-most-traded currency globally.
Informally, it is accepted in parts of Sweden, Finland, and Danish ferry ports due to its proximity to Norway, with Norwegians often engaging in border shopping for items like food, alcohol, and tobacco, motivated by lower prices compared to Norway’s high taxes on these goods.
The krone is known for its stability and reliability, supported by Norway’s strong economy. It’s actively traded in international markets, facilitating easy currency exchange.
Introduced in 1875, replacing the Norwegian speciedaler at a rate of 4 kroner per speciedaler, the krone was part of the Scandinavian Monetary Union, allowing mutual exchangeability with Danish and Swedish currencies at par value until 1914.
Originally on a gold standard, this was suspended several times and eventually abandoned in 1931. The krone underwent various pegs to the British pound and the U.S. dollar over the years.
During the German occupation in World War II, it was pegged to the Reichsmark. After the war, it was pegged again to the pound and the dollar.
In 1992, Norway shifted from a fixed exchange rate to a floating system due to heavy speculation against the krone, leading to significant financial intervention by the Central Bank of Norway.
History of Coins
In 1875, Norway introduced its new coinage in various denominations, marking a significant transition in its monetary system. These coins, some dated 1874, ranged from 10 and 50 øre to 1 and 10 kroner, also indicating their value in the old currency system.
Over time, the composition of Norwegian coins evolved: gold coins were last issued in 1910, silver was replaced by cupro-nickel in 1920, and iron temporarily replaced bronze between 1917 and 1921.
Significant changes continued throughout the 20th century, with the introduction of new denominations and the cessation of older ones, reflecting Norway’s adapting economy and technology.
The modern Norwegian coinage, introduced between 1994 and 1998, consists of 1, 5, 10, and 20 kroner coins. The 50 øre coin was withdrawn from circulation in 2012.
These coins feature various national symbols and the effigy of the current monarch, King Harald V. The Norwegian Central Bank distributes these coins and banknotes, and up to 25 coins of any single denomination are legally recognized as payment in Norway.
Interestingly, the Norwegian 20 kroner coin closely resembles the Syrian 10 pound coin, leading to issues with automated machines in Norway.
Due to the significant value difference and the misuse of Syrian coins in machines, Norway had to adjust its systems to distinguish between the two. This situation highlights the unique challenges and intricacies in the world of coinage and currency.
History of Bills
In 1877, Norges Bank started issuing paper notes in denominations of 5, 10, 50, 100, 500, and 1000 kroner.
During World War I, due to metal shortages, 1 and 2 kroner notes were introduced, with 1 kroner notes in 1917 and 2 kroner notes from 1918 to 1922. These denominations were again issued between 1940 and 1950.
Over time, lower denomination notes were replaced by coins: 5 kroner notes in 1963 and 10 kroner notes in 1984. In 1994, a new 200 kroner note was introduced.
The current series of Norwegian banknotes, introduced between 2017 and 2019, features various themes and colors. The 50 kr note, green in color, displays the Utvær Lighthouse.
The 100 kr note, red, features the Gokstad ship. The 200 kr note, in blue, has a Codfish design. The 500 kr note, orange, showcases the Rescue vessel RS 14 Stavanger.
Lastly, the 1000 kr note, purple, is adorned with a wave in the sea. These notes are not only functional but also artistically represent Norway’s maritime heritage and natural beauty.
Today, the Norwegian krone is a stable currency that is widely accepted around the world. The history of the Norwegian currency is a testament to the country’s rich cultural heritage and its commitment to financial stability.
Inflation and Buying Power of Norwegian krone
Since 1956, the Norwegian Krone has experienced a significant devaluation, losing 94% of its value. As of December 12, 2023, what was worth kr100 in 1956 is now equivalent to approximately kr1,737.01, indicating a cumulative price increase of 1,637.01% over 67 years.
This inflation, averaging 4.35% annually, means that prices today are 17.37 times higher than they were on average in 1956. As a result, the current value of the krone is just 5.757% of its value in 1956.
The inflation rate in 1956 was 3.80%, and the recent rate is 4.77%. If this trend continues, the buying power equivalent of kr100 today will be around kr104.77 next year.
Norway’s core inflation surged to a record 6.7% in May, exceeding expectations and forecasts, which suggests that Norges Bank may continue raising interest rates beyond summer.
This high inflation rate poses challenges for Norwegian households, the world’s most indebted, and complicates policy decisions due to a weaker-than-expected krone that’s driving up imported prices.
Analysts now anticipate more aggressive rate hikes by Norges Bank, possibly exceeding 4%, with a potential for a significant rate increase at their June meeting. Investors expect a series of hikes in the coming months.
This inflation is partly driven by a 13% rise in food and non-alcoholic drink prices and a 7.5% increase in transport costs, exacerbated by the weak krone.
The International Monetary Fund has advised against additional government spending to avoid further inflationary pressures. With core inflation expected to remain high, Norges Bank is likely to aim for an interest rate peak of around 4%.
The current series of Norwegian banknotes features distinctive designs and colors. Each note’s unique design reflects various aspects of Norwegian culture and industry.
The 50 kr note, green in color, showcases the Utvær Lighthouse and a stylized lighthouse beacon with Karlsvogna (Big Dipper).
The 100 kr note, red, features the Gokstad ship along with a stylized container ship, a globe, and Orion.
The blue 200 kr note displays a Codfish and includes a stylized fishing boat, fishing net, and beacon.
The 500 kr note, orange, highlights the Rescue vessel RS 14 Stavanger with a stylized oil platform, gas pipeline networks from the North Sea, and an ammonite.
Lastly, the purple 1000 kr note, depicts a wave in the sea with a stylized horizon and water molecules.
Currency Usage in Norway
In Norway, the Norwegian Krone (NOK) is the primary currency used for all transactions. The currency includes coins in denominations of 1, 5, 10, and 20 kroner and banknotes of 50, 100, 200, 500, and 1000 kroner.
Norway is predominantly a cashless society, with debit and credit cards widely accepted in most places, including public transport.
Mobile payment options like Google Pay and Apple Pay are increasingly popular. While cash is less commonly used, it’s still useful for small purchases or in rural areas where card acceptance might be limited.
Foreign currencies like Euros or USD are generally not accepted, so it’s best to exchange money into kroner before arriving or use ATMs in Norway.
Norwegian coins have unique designs showcasing the country’s culture and nature, and øre (cents) was phased out in 2012. Some Norwegians shop in neighboring countries for certain goods due to lower taxes.
Overall, Norway offers a modern, cashless-friendly experience but having some cash can be beneficial in certain situations.
Can I Use Euros in Norway?
No, you cannot use Euros in Norway. Even though Norway is in Europe, it does not use the Euro as its official currency. You will need to exchange your currency to Norwegian krone to use it in Norway.
Is USD accepted in Norway?
In Norway, the US dollar is not commonly accepted, so it’s necessary to exchange dollars for Norwegian krone, which can be done at banks and exchange offices.
However, using a credit card or withdrawing krone from an ATM is often more favorable due to better exchange rates.
Since the krone is the only legal currency in Norway, it’s important to have some on hand for smaller purchases or emergencies, even though credit cards are widely accepted.
Exchanging Currency in Norway
When traveling to Norway, exchanging your currency for the Norwegian Krone (NOK) is essential, as it is the official currency.
You can exchange money at banks, exchange offices, hotels, and airports. Banks are often the best choice for exchanging currency because they offer favorable exchange rates and lower fees, but be aware of their operating hours and remember to carry identification like a passport.
Exchange offices, commonly found in tourist areas, are convenient due to longer hours, but they might charge higher fees and offer less favorable rates.
ATMs are widely available across Norway and most accept foreign cards, providing another convenient way to obtain Krone. Keep in mind that Norway is relatively expensive, so budget accordingly for your trip.
Where can I exchange Norwegian krone?
When exchanging Norwegian Krone (NOK), there are several options both within and outside Norway.
Inside the country, major banks like DNB, Nordea, and Sparebank1 offer currency exchange services, though their rates may not always be the most competitive.
Dedicated currency exchange bureaus such as Forex and Xchanger, located in major cities and tourist areas, often provide more competitive rates and quicker transactions. ATMs are also available for cash withdrawals and some may offer currency exchange, but this might come with higher fees.
Outside Norway, you can exchange currency at your home bank, though rates may not be ideal, or at currency exchange bureaus in airports and major travel hubs, which are convenient but might offer less favorable rates.
Online services like Wise and Travelex are another option, providing competitive rates and online transactions, though they may include delivery times and fees.
When exchanging NOK, it’s wise to compare rates from different providers to ensure the best deal. This can be done using online tools or by getting quotes directly.
The exchange rates can vary depending on the amount being exchanged, with larger sums potentially receiving better rates. Be mindful of fees charged by currency exchange services and any hidden costs such as delivery or insurance fees.
By considering these factors, you can find the most efficient and cost-effective way to exchange your Norwegian Krone.
What to know before exchanging currency in Norway
Exchanging currency into Norwegian Krone requires consideration of rates, fees, location, and timing to ensure a smooth process and the best value. It’s important to understand the mid-market rate, which is the average between buying and selling rates, and compare how much services mark up this rate.
Be aware of hidden fees like commission charges and handling fees, and ask for a full breakdown of charges. For larger amounts, try negotiating a better rate at currency exchange bureaus.
Banks, bureaus, ATMs, and online services offer varying rates, but tourist areas typically have less favorable rates. Since currency rates fluctuate, consider exchanging closer to your travel date and on weekdays for better rates.
Ensure you have a valid ID for the transaction and check if there are any limitations on the amount you can exchange. Ensure your cash is in good condition, as some services may not accept worn or damaged notes.
Using debit or credit cards can be a convenient and cost-effective alternative to cash, as many places in Norway accept cards with minimal fees. A currency converter app can help track exchange rates and manage spending.
Lastly, inform your bank of your travel plans to prevent your card from being blocked for suspicious activity. With careful planning and these tips, you can efficiently exchange your currency for Norwegian Krone and enjoy your time in Norway.
Choosing Between USD and Norway Currency
When visiting Norway, choosing between using USD and exchanging it for Norwegian Krone (NOK) involves considering exchange rates, convenience, and fees. Here are some factors to consider when making your decision.
Rates fluctuate daily, so it’s important to check current rates and be mindful of exchange fees from banks, bureaus, or online services. Research, compare rates and fees, and choose the option that aligns with your budget and travel style.
Carrying NOK is convenient for small, especially in rural areas, but carrying large amounts of cash can be risky. Most places accept major debit and credit cards, providing security and eliminating the need to carry cash.
Using your credit card may be more convenient than exchanging your USD for NOK. Most businesses in Norway accept credit cards, and you won’t have to worry about carrying around cash or exchanging currency.
When exchanging currency, there may be fees involved. It’s important to check with your bank or exchange service to see what fees they charge for exchanging USD to NOK.
Additionally, using your credit card abroad may also come with fees such as foreign transaction fees and ATM fees. It’s important to check with your bank to see what fees apply to your account.
In smaller towns and rural areas, carrying some cash is advisable as credit cards may not always be accepted. Before your trip, check with your bank or currency exchange service for fees associated with exchanging USD to NOK.
Also, inquire about any fees your bank may charge for using your credit card abroad. Keep an eye on the daily fluctuating exchange rates.
While Norway’s official currency is NOK and some places might accept USD, it’s generally better to use the local currency for fair exchange rates.
To get the best rates, compare exchange rates at banks and exchange offices, but be aware of their fees. Avoid exchanging money at airports, as they often have higher rates.
Lastly, since Norway is a cashless society, bringing a credit or debit card for transactions, even small ones, is a good idea.
By considering these factors, you can make an informed decision on whether to exchange your USD for NOK or use your credit card when traveling to Norway.
Cost of Living in Norway
Norway is known for its high cost of living, and it’s important to be aware of this before moving there. The country’s high standard of living is reflected in its prices, which can be significantly higher than those in the US.
Living in Norway is expensive, with the cost varying by lifestyle and location. Monthly expenses range from 20,000 to 40,000 NOK (2,176–4,352 USD) without rent.
Oslo, Bergen, Stavanger, and Trondheim are the costliest cities, with monthly living costs for a single expat around 10,310 to 10,550 NOK and for a family of four between 37,450 and 38,460 NOK.
More affordable areas include Hedmark, Telemark, Oppland, and rural Østfold. Food in Norway, much of which is imported, is pricey, with grocery items like milk, bread, and meat costing significantly more than in many countries.
Utilities for an 85 sqm apartment average around 1,571 NOK, and internet costs about 473 NOK per month. Public healthcare is free for children under 16, pregnant and nursing women, and others pay an annual deductible for free healthcare after reaching the limit.
Education, including higher education, is mostly free, even for international students, with minimal fees for extra services. Childcare is subsidized, with a cap on fees.
Transportation costs, such as local transport tickets and taxi fares, add to the living expenses. Despite high costs, Norway’s high salaries and comprehensive social services balance the overall cost of living.
One of the main factors contributing to the high cost of living in Norway is the country’s strong economy and high wages. This means that prices are generally higher across the board, as businesses can charge more due to the increased purchasing power of consumers.
However, it’s important to note that while prices may be higher in Norway, the quality of life is also generally higher. The country is known for its excellent healthcare system, strong social welfare programs, and high level of safety.
Additionally, many expats report that the high cost of living is offset by the country’s stunning natural beauty and unique cultural offerings.
Don’t Get Scammed Tips
Norway is a relatively safe country, but like anywhere else, there are always scammers looking to take advantage of unsuspecting tourists. Here are some common scams to watch out for:
- Be cautious of strangers offering deals on the street, as they are likely too good to be true. Keep your valuables secure in a money belt or zipped pocket to prevent pickpocketing and try not to carry or show large amounts of cash.
- Trust your instincts in any situation that feels off. When booking accommodations, use well-known websites, read other guests’ reviews, and be extra careful with private rentals.
- For transportation, buy tickets from official sources to avoid overpriced offers and be aware of the usual taxi fares to avoid being overcharged. Watch out for fake ticket inspectors who should be in uniform and carry ID.
- Exchange currency at legitimate banks or licensed bureaus, be cautious at ATMs to avoid skimming, and avoid clicking on suspicious links or responding to unknown emails to prevent phishing scams.
- Be wary of online relationships that progress quickly and involve financial requests, as these could be romance scams.