The Central Bank of Iceland has signed an agreement with the European Central Bank for Iceland to join the Eurosystem’s TARGET Instant Payment Settlement system. From 2028, this will allow instant payments in Icelandic krónur to be settled in central bank money through TIPS, replacing Iceland’s current system for real-time settlement of payments and moving domestic payment processing onto shared Eurosystem infrastructure. Iceland’s entry makes ISK the fifth currency available in TIPS, alongside the euro, Swedish krona, Danish krone and, from 2028, the Norwegian krone. The central bank links the move to stronger operational security, faster and more reliable 24-hour payment processing for households and businesses, and better alignment with international standards. An alternate route will also be introduced alongside TIPS so critical payment services can continue if the platform is temporarily inaccessible, reducing operational risk in domestic payment intermediation.
Central Bank of Iceland2026-06-24
Central Bank of Iceland signs ECB agreement for TIPS settlement of ISK instant payments from 2028
The Central Bank of Iceland has agreed with the European Central Bank for Iceland to join TIPS, enabling instant settlement of ISK payments in central bank money from 2028. The move will replace Iceland’s current real-time settlement system, make ISK the fifth TIPS currency and add a backup route to support continuity if TIPS is unavailable.