Car Rental in Iceland With No Deposit: What Card You Actually Need

A low daily rental price does not always tell you how much money or available credit you need to collect the car. The rental payment, card deposit, insurance excess and possible additional charges are separate parts of the agreement. Understanding the difference can prevent an unpleasant surprise when you arrive in Iceland.

Zero Car does not hold a standard rental deposit or block a security amount on your card while you have the vehicle. You still need an accepted payment card, and a credit or debit card imprint is recorded as a guarantee under the rental agreement. Zero accepts major credit cards and 16-digit debit cards. Payments are completed online, and cash is not accepted.

This guide explains exactly what that means, how card holds affect credit and debit cards, why a no-deposit rental is different from zero excess, and which costs can still be charged after the vehicle is returned.

Zero Car deposit and card requirements at a glance

Requirement	Zero Car policy	What it means for you
Rental deposit	No standard deposit	No security amount is blocked while you have the car.
Card hold	No card hold	Your available card balance is not reduced by a rental security hold.
Credit card	Accepted	Major credit cards can be used for payment and as the rental guarantee.
Debit card	Accepted	A 16-digit debit card can be used for payment and as the guarantee.
Card imprint	Required	Your card details are recorded as security for valid costs arising under the rental agreement.
Cash	Not accepted	Rental payments are completed online.
Payment currency	Icelandic króna	Your bank or card provider handles any currency conversion.

The four amounts hidden behind a rental-car price

Travellers often treat the words deposit, excess, insurance and rental price as if they describe the same thing. They do not. A rental agreement can involve four different financial amounts, each with a different purpose.

1. The rental price

This is the amount you pay to rent the vehicle. It may include insurance, taxes, mileage and other services, or those may be added separately depending on the company and rate.

Whether you pay during booking or closer to pickup depends on the booking option you select. The timing of the rental payment is separate from the deposit policy. A pay-later booking does not automatically mean a deposit is required, and a prepaid booking does not automatically mean there will be no card hold.

2. The rental deposit or card hold

A deposit is an amount a rental company may take or temporarily reserve as financial security. It is commonly processed as a card pre-authorisation rather than a completed payment.

Although a pre-authorisation is not normally a final charge, the reserved amount is no longer available for you to use. The effect depends on the type of card:

• On a credit card, the hold reduces the remaining credit available on the account.
• On a debit card, the hold can reduce the funds available in the connected bank account.

The amount may be released after the vehicle is returned, but release is not always immediate. The timing can depend on the rental company, payment processor, card network and issuing bank.

This is why a temporary hold can still affect a trip. The money may not have been spent, but it may be unavailable when you need to pay for accommodation, fuel, meals, activities or an unexpected change of route.

3. The insurance excess

The excess is the amount you may have to pay when covered damage occurs. It is sometimes called the deductible or self-risk.

For example, a rental could have a high damage excess even if the daily rate looks low. The company may then require a larger card deposit because the renter remains financially responsible for part of a covered claim.

Zero Car includes full insurance with zero excess for covered damage. This is separate from the no-deposit policy. Zero excess addresses covered damage liability. No deposit addresses how much money is blocked on your card.

4. Charges outside the normal rental price

Some costs are neither a deposit nor an insurance excess. These may include unpaid parking, traffic fines, missing fuel, lost keys, late return or damage caused by prohibited use.

A no-deposit rental does not remove these responsibilities. It means that money is not blocked in advance as general security against them.

Deposit, card imprint and card charge are not the same thing

Term	What happens	Effect on your available funds
Deposit or pre-authorisation	An amount is reserved against the card as security.	The reserved amount becomes temporarily unavailable.
Card imprint	The card is recorded as a guarantee under the rental agreement.	No standard security amount needs to be blocked.
Completed card charge	A payment is processed for the rental or another valid amount due.	The amount is charged to the card account.
Refund	A completed payment is returned to the card.	The return time depends on the payment and issuing banks.
Release of a hold	A temporary authorisation is removed.	Your available balance or credit is restored.

Zero Car uses a credit or debit card imprint rather than blocking a standard rental deposit. The card still provides financial security for the rental agreement, but your available balance is not reduced by a general deposit while the vehicle is in your possession.

Why rental companies use deposits

A rental vehicle remains the property of the rental company while it is being used by another driver. The company may therefore use a deposit to protect itself against costs that are not yet known when the rental begins.

Those costs can include:

• The renter’s insurance excess after covered damage
• Damage that falls outside the insurance policy
• Missing fuel or battery charge
• Late return or unapproved drop-off
• Missing keys, equipment or accessories
• Traffic fines, parking charges and tolls
• Additional cleaning caused by the condition of the vehicle

A deposit is therefore not necessarily an additional rental fee. It is a form of security. However, it still affects the amount of money or credit available to the traveller.

The deposit policy should always be considered together with the insurance excess. A rental with a small card hold but a high excess can still leave the renter financially exposed. A rental with no deposit but unclear insurance exclusions also requires careful review.

How the no-deposit process works with Zero Car

Zero Car is built around an online rental process rather than a traditional counter handover. The main rental, driver and card information is completed before collection.

1. You choose the vehicle and booking option online.
2. You complete online check-in before pickup.
3. You provide the requested driving licence and card information.
4. A credit or debit card imprint is recorded as a guarantee.
5. No standard rental deposit or security amount is blocked.
6. You receive the keybox access code before the scheduled pickup.
7. You collect the keys and begin the rental without choosing insurance packages at a counter.

Zero Car’s rental provider is Blue Car Rental, so the rental agreement and some operational information may refer to Blue Car Rental as the provider. The rights and responsibilities attached to the card imprint are set out in the rental terms and conditions.

What card do you need for a Zero Car rental?

A traditional credit card is not required if you have an accepted 16-digit debit card. Both can be used for the rental payment and as the guarantee while the vehicle is in your possession.

Using a credit card

Major credit cards are accepted. Because Zero does not block a standard deposit, your available credit is not reduced by a general rental security hold.

You should still confirm that the card is active, valid for international online transactions and has enough available credit for the rental payment and your other travel costs.

Using a debit card

Zero accepts a debit card with a 16-digit card number. The debit card can be used for both payment and the rental guarantee.

This is especially useful for travellers who do not have a conventional credit card. With a rental company that places a deposit on debit cards, the reserved amount can reduce the money available directly from the customer’s bank account. Zero does not block that standard deposit amount.

Prepaid, virtual and non-standard cards

Do not assume that every prepaid, virtual or app-based card will work in the same way as a standard credit or debit card. Card products can differ by issuer, country and account type.

If your only card is prepaid, virtual, does not have a 16-digit number or has restrictions on international online transactions, contact Zero Car before booking.

Cash and payment currency

Cash payments are not accepted. Zero Car accepts online card payments, and all payments are processed in Icelandic króna.

Your bank or card provider manages the conversion from your account currency. Check the exchange rate and foreign transaction fee applied by your card provider when calculating the final cost of the rental.

No deposit does not mean no financial responsibility

The most important distinction in this guide is simple: Zero Car does not block a standard rental deposit, but the renter remains responsible for the rental agreement.

The card imprint may be used for legitimate amounts that become due because of the renter’s use of the vehicle. Under the current terms, this can include:

• Missing or damaged vehicle accessories
• Missing fuel or battery charge
• Unapproved drop-off or one-way charges
• Late return and related costs
• Excessive cleaning
• Traffic, parking and toll charges
• Administrative handling costs connected with unpaid charges
• Costs caused by an unregistered driver
• Damage resulting from prohibited or negligent vehicle use
• Other valid charges described in the rental agreement

The rental terms permit valid charges, fines and costs connected with the rental to be charged after the vehicle has been returned. This is relevant because parking notices, traffic fines and similar claims may reach the registered vehicle owner later.

These are not hidden deposits. They are separate charges that arise only when the relevant cost, breach or incident occurs. The full conditions are explained in the Zero Car terms and conditions.

No deposit and zero excess solve different problems

Rental feature	The problem it addresses	What it does not mean
No deposit	Keeps a standard security amount from being blocked on your card.	It does not remove contractual responsibility for fines, fuel, misuse or other valid charges.
Zero excess	Reduces your excess to zero for damage covered by the included protection.	It does not cover illegal, reckless, negligent or prohibited use.
Full insurance	Includes the main protections relevant to driving a rental car in Iceland.	It does not mean that every possible incident or action is covered.
Roadside Assistance Waiver	Reduces eligible roadside assistance costs to zero.	It does not cover assistance caused by negligence, misuse or driving where the vehicle is not permitted.

This distinction matters when comparing rental offers. No deposit protects your available card balance. Zero excess protects you from the normal excess on covered damage. The insurance terms determine which events are covered in the first place.

What insurance is included with Zero Car?

Every Zero Car rental includes the following protections:

• Collision Damage Waiver and Super Collision Damage Waiver: Protection relating to collision damage to the rental vehicle.
• Theft Protection: Protection relating to theft of the vehicle.
• Gravel Protection: Protection designed for gravel-related damage.
• Sand and Ash Protection: Protection relating to damage caused by blowing sand, ash and similar material.
• Zero Excess Insurance: Reduces the excess to zero for covered damage.
• Roadside Assistance Waiver: Included access to 24/7 assistance without a separate roadside package.

Unlimited kilometres, 24% VAT and the mandatory road tax are also included in the Zero rental price. These are rental inclusions rather than insurance products.

For the detailed coverage and current exclusions, read the official Zero Car insurance policy. The longer guide to full insurance and zero excess in Iceland explains how the individual protections fit together.

Where zero excess ends

Full insurance should never be interpreted as permission to ignore the rental terms, vehicle restrictions, road closures or weather conditions.

The Zero Car insurance policy excludes damage and costs caused by actions such as:

• Off-road driving
• Driving while under the influence of alcohol or drugs
• Reckless, negligent or unsafe driving
• Ignoring road closures or dangerous conditions
• Standing, sitting or climbing on the vehicle
• Damage to the vehicle interior
• Mechanical damage caused by incorrect use
• Using the wrong fuel
• Adding fuel, water, oil or another fluid to the wrong system
• Towing or recovery required because of misuse or driving where the vehicle is not allowed

Parking fines, traffic fines, tolls, lost keys and similar charges are also not insurance claims. They remain the renter’s responsibility.

F-roads, highland driving and river crossings

A no-deposit rental does not change which roads your vehicle is permitted to use. Standard vehicles must not be driven on F-roads or other restricted highland routes. A suitable four-wheel-drive or all-wheel-drive vehicle must be selected and approved for the planned route.

Off-road driving and F-road driving are not the same thing. F-roads are marked public mountain roads. Off-road driving means leaving marked roads or tracks, and it is prohibited in Iceland.

River crossings require particular care. A four-wheel-drive vehicle and zero-excess insurance do not make every river crossing safe or covered. Water depth, current, riverbed conditions and weather can change quickly. Driving in or across water can leave the renter responsible under the rental terms.

Read the Zero Car driving guide before selecting a vehicle for highland or remote-road travel.

The real financial exposure of an Iceland car rental

There are two different numbers to compare when evaluating a rental offer.

Your total cash cost includes the rental price, mandatory charges, selected extras and any costs you actually incur during the trip.

Your financial exposure includes the insurance excess, excluded risks and any deposit or card hold required before the rental begins.

A deposit is not necessarily part of the final cash cost, but it is still part of the financial requirement. You must have enough card capacity for the amount to be reserved, and you may not be able to use that amount during the rental.

How to compare Iceland rental offers properly

What to check	Why it matters
Total rental price	Confirm what you will actually pay after mandatory fees and taxes.
Deposit or pre-authorisation	Determine how much card capacity will become unavailable and for how long.
Insurance excess	Check how much you may have to pay after covered damage.
Included insurance	Find out whether gravel, sand and ash, theft and collision protection are already included.
Insurance exclusions	Understand which types of damage or vehicle use remain your responsibility.
Roadside assistance	Check whether help is included or sold as a separate package.
Mileage	Limited mileage can change the total price of a long Iceland road trip.
Road tax	Confirm whether the mandatory charge is included or added separately.
Accepted cards	Do not assume a debit card, prepaid card or virtual card will be accepted.
Pickup process	Counter collection, queues and opening hours can affect the start of your trip.
Return obligations	Check fuel, charging, cleanliness, timing and damage-report requirements.

A lower headline price may still require additional insurance and a large card hold. A more inclusive price may require less available card capacity and reduce financial uncertainty. Compare the entire rental arrangement rather than only the daily rate.

Who benefits most from a no-deposit rental?

No deposit can be useful for any traveller, but it has particular value in several situations.

Travellers using one main credit card

Hotels, fuel stations and other travel providers may also place temporary authorisations on a credit card. A rental deposit can reduce the remaining credit available for the rest of the trip.

Travellers using a debit card

A hold on a debit card can affect the actual spending balance in the connected account. Avoiding a standard rental deposit leaves those funds available for normal travel expenses.

Families and larger groups

Larger groups often have higher accommodation, food and activity costs. Keeping available card capacity free can make budgeting simpler.

Longer road trips

A deposit may remain reserved for the entire rental and sometimes beyond the return date while the issuing bank processes the release. The longer the rental, the longer the traveller may be without access to that balance.

Travellers with multiple prepaid bookings

Even when accommodation and activities have already been booked, the trip may still require available funds for fuel, parking, meals and weather-related changes. A no-deposit rental reduces one source of temporary card pressure.

Driver and licence requirements still apply

Having an accepted card does not automatically make someone eligible to rent a vehicle. Zero Car’s current driver requirements include:

• The standard minimum rental age is 20.
• The minimum age is 23 for a large SUV or passenger vehicle.
• The driver must have held a valid driving licence for at least one year.
• The licence must use the Roman alphabet.
• If the licence uses another script, an International Driving Permit is required together with the original licence.
• The minimum rental period is 48 hours.

Driver and licence information is provided during online check-in. You should still travel with your original physical driving licence and any required International Driving Permit.

Before booking a no-deposit rental

1. Check the card number. If you are using a debit card, confirm that it has a standard 16-digit card number.
2. Enable international online payments. Some banks restrict foreign or online transactions unless they are enabled by the cardholder.
3. Review currency costs. Zero charges in Icelandic króna, and your own bank controls the conversion rate and card fee.
4. Check the driver requirements. Confirm the driver’s age, licence duration and language requirements.
5. Choose a vehicle for the route. Do not book a standard car for an itinerary that includes F-roads.
6. Read the current terms. Pay particular attention to permitted roads, insurance exclusions and return requirements.
7. Complete online check-in early. Make sure the requested driver and card details are submitted before pickup.
8. Check your email address and phone number. These details are used for pickup information and keybox access.

Collecting your no-deposit rental at Keflavík Airport

Zero Car uses keybox pickup near Keflavík International Airport. Once online check-in is complete, the keybox code is normally sent by email 30 to 60 minutes before the scheduled pickup time.

After leaving the arrivals hall, walk across to the departures side of the terminal. Exit the building and cross the P1 parking area to reach the rental office at Blikavöllur 3. The walk takes approximately three to four minutes.

Enter the delivery office, find the keybox by the Zero Car and Blue Express signs, enter the code and collect the keys. The vehicle will be waiting outside.

There is no standard deposit transaction to complete at a counter and no need to choose between several insurance packages on arrival. The main rental steps have already been handled online.

See the full route and instructions on the pickup and drop-off page.

Collecting your rental in Reykjavík

Zero Car also offers keybox pickup and return at Fiskislóð 22 in Reykjavík. This can suit travellers who plan to spend their first days in the capital before beginning a road trip.

The same no-deposit and online check-in process applies. The guide to Keflavík Airport and Reykjavík pickup explains the practical difference between the two locations.

What happens to your card after the vehicle is returned?

Because Zero Car does not block a standard rental deposit, there is no general security hold waiting to be released after a normal return.

You should still complete the return correctly:

• Return the vehicle at the agreed time and location.
• Return it with the required fuel or battery level.
• Return the keys and all rented accessories.
• Do not leave the interior or exterior excessively dirty.
• Report any accident or new damage.
• Complete an accident report when an incident has occurred.
• Pay parking charges and tolls within the applicable payment window.

If no valid additional cost arises, there is no deposit to refund. If a legitimate charge appears later, such as an unpaid parking notice connected to the rental, it may be processed according to the rental agreement.

Road tax, parking and tolls are separate from the deposit

The mandatory Icelandic road tax is included in the Zero Car price as a fixed daily rate. It does not increase based on how far you drive during the rental.

This government road tax is separate from parking charges, attraction parking, tunnel tolls and traffic fines. Those remain the responsibility of the driver.

Read the Iceland road tax guide for an explanation of the daily charge. The guide to parking fees, fines and toll roads in Iceland explains how to avoid unpaid charges reaching the rental company after the trip.

The bottom line

A rental deposit, card hold, card imprint and insurance excess are different things. The distinction matters because each affects your trip in a different way.

• Zero Car does not block a standard rental deposit while you have the vehicle.
• Major credit cards and 16-digit debit cards are accepted.
• A credit or debit card imprint is still required as a guarantee.
• Full insurance with zero excess is included for covered damage.
• Roadside assistance, unlimited kilometres, VAT and the mandatory road tax are included.
• Fines, fuel, charging, prohibited use and other contractual costs remain the renter’s responsibility.

The result is a clearer rental arrangement. You know the rental cost, your available card balance is not reduced by a standard security hold, and you do not have to wait for a deposit to be released after a normal return.

Browse the Zero Car rental fleet in Iceland to compare available vehicles. Every booking includes no standard deposit, full insurance with zero excess for covered damage, unlimited kilometres and 24/7 roadside assistance.

The rental agreement and terms applying to your booking take precedence over this guide.