Expanding into Norway represents exciting potential for business growth, especially for ecommerce given that 98% of the population has access to the internet. Businesses that want to accept payments in Norway will find local preferences similar to those of its Nordic neighbors but with a uniquely Norwegian character.

Below, we’ll explore how your business can succeed in the Norwegian payment market by:

• Embracing contactless payments
  
• Improving the checkout experience
  
• Protecting online payments
  

The state of the market

Norwegian customers are shifting further toward digital and contactless payments. Norway has one of the highest annual rates of payment card use per person in the world. Digital adoption was boosted by the ubiquity of BankAxept, a national payment card scheme that’s used for point-of-sale (POS) and online transactions, and the widespread adoption of mobile payment apps in Norwegian kroner (NOK).

Although Norway isn’t a member of the European Union, its regulatory alignment with EU standards such as the General Data Protection Regulation (GDPR) provides a harmonious payment experience for businesses that operate throughout Europe, especially regarding cross-border transactions. Norway’s adherence to these regulations bolsters its reputation for trustworthiness and security in financial transactions.

Norges Bank, Norway’s central bank, is fundamental to maintaining the country’s financial stability, and the Financial Supervisory Authority of Norway (Finanstilsynet) closely monitors and regulates the financial sector, overseeing the soundness of banking and financial services in the nation.

Payment methods

Technological advancements, changing consumer preferences, and regulatory guidelines have all created a contemporary payment space where cash’s prominence is waning. Here’s a closer look at Norway’s popular payment methods.

Current usage

In recent years, Norway has seen declining cash usage. According to Norges Bank’s 2022 survey, only 3% of Norwegians reported using cash in their most recent POS transactions. Contactless payments have largely taken over, accounting for 86% of POS transactions that same year. International cards are also growing in popularity as more people shop online and travel abroad, with the same survey finding that the share of card transactions made using international credit cards increased from 37% in 2021 to 43% in 2022.

According to Norges Bank, there was also a 133% increase in the number of mobile wallet transactions from 2021–2022, illustrating the growing trust and convenience that Norwegians associate with mobile payments. Digital banking platforms and mobile payment apps like Vipps have played a pivotal role in nudging the population toward cashless options, offering peer-to-peer payment features and quick contactless payments online and in-store. In 2022, Vipps announced a merger with the Danish mobile payment app MobilePay to form Vipps MobilePay.

Popular B2C payment methods in Norway

• Credit and debit cards (e.g., BankAxept)
  
• Mobile payments (e.g., Vipps)
  
• Bank transfers
  
• BNPL (e.g., Klarna)
  

Popular B2B payment methods in Norway

• Credit cards
  
• Credit transfers
  
• Direct debits
  

Emerging trends

Norway hasn’t been exempt from the global cryptocurrency wave. A 2023 report found that about 8% of Norwegians owned cryptocurrencies, an ownership rate similar to that of other European countries. More Norwegians aged 39 or under owned cryptocurrency than stocks. However, the Norwegian government has issued a cautious cryptocurrency policy and cryptocurrencies aren’t considered legal tender, but rather assets that are subject to capital gains tax.

Ease and friction of entry

Expanding your business into Norway requires unique considerations regarding taxes, payment disputes, cross-border payments, and payment security. Here’s a quick rundown.

Taxes

In Norway, the standard value-added tax (VAT) rate for goods and services is 25%, but a reduced rate of 15% applies to certain goods such as food and beverages. While customers pay this tax as part of the purchase price, businesses must collect and forward it to the Norwegian Tax Administration. Any lapses on the business side can result in substantial penalties.

Chargebacks and disputes

Norway’s Consumer Purchases Act grants customers the right to dispute charges in several circumstances (e.g., nondelivery of goods or services, a product or service doesn’t meet the expected standard). While customers must validate their claims, the system puts the onus of proof on businesses, in line with European directives that prioritize consumer protection.

Adherence to the revised Payment Services Directive (PSD2) also requires Strong Customer Authentication (SCA). With SCA, businesses are better equipped to prevent fraudulent transactions, as two-factor authentication is mandatory for most online purchases and can provide the business with additional evidence in disputes.

International payments

It’s important to understand how currency conversion and international transactions work in the Norwegian market if your business accepts cross-border B2B or B2C payments. Here’s what to know.

• Currency conversion
  International payments in Norway often require currency conversion, especially because Norway doesn’t use the euro like much of Europe, and the additional fees can influence pricing strategies and profit margins. Widely used platforms in Norway like Stripe offer currency conversion services at competitive rates, making it easier for businesses to accept international payments.

• Transparent conversion fees
  Financial institutions in Norway are required to provide clear information about any fees or markups related to currency conversion, giving businesses a full picture of what they and their customers will be charged.

• Multicurrency features
  Offering payment options in currencies other than NOK, such as the euro, can reduce barriers for international customers who prefer to see prices in their local currencies. Integrating payment gateways with multicurrency features can simplify this process for both businesses and customers.

Security and privacy

Norway has strong payment security regulations. As a member of the European Economic Area, it has adopted many EU guidelines. The nation’s approach is both adaptive to modern financial methodologies and focused on user security and transparency. Below is an overview.

• Data protection laws
  Norway adheres to the GDPR, which mandates strict data protection standards. Organizations must obtain users’ explicit consent before they collect personal data and offer data deletion on request. The Norwegian Data Protection Authority oversees GDPR compliance.

• SCA
  Norway has also adopted PSD2. A core component of this directive is SCA, necessitating two-factor authentication for most electronic payments. SCA boosts transaction security by incorporating forms of identification such as personal identification numbers (PINs), one-time passcodes, and fingerprint scans.

• Anti-Money Laundering (AML) guidelines
  AML and Countering the Financing of Terrorism (CFT) standards in Norway align with broader European directives aimed at preventing financial crimes and tracing illegal funds. Financial institutions must conduct thorough customer due diligence and report suspicious transactions to Norway’s Financial Intelligence Unit.

• Financial Supervisory Authority’s role
  The Financial Supervisory Authority of Norway oversees the country’s financial entities to ensure banks, payment processors, and other financial institutions operate within the country’s regulatory framework. The agency continually reviews and updates guidelines to keep pace with developing financial trends and technologies.

Key success factors

While Norway sits at the forefront of payment improvement, the country faces complex challenges inherent to modernizing and maintaining a dynamic payment system in a global economy. Here are some ways businesses that accept payments in Norway can adapt.

• Contactless payments infrastructure
  Contactless payments have seen a sharp rise in Norway, with about 12.5 million contactless cards in circulation in 2022. From contactless cards to mobile payment apps, businesses should be prepared to accept various contactless payment methods in person and online.

• Mobile adaptability
  The rise of ecommerce has also led to the rise of mobile shopping. Designing your business’s website and payment pages to work well on smartphones will serve customers who prefer to complete transactions on their phones.

• Strict regulatory compliance
  Because Norway adheres to many EU regulations, its regulatory environment can be more complex. It’s important for businesses that operate in this market to understand both the EU rules Norway follows and the country’s own standards to stay compliant.

• Powerful fraud detection and prevention tools
  Like much of the world, Norway has experienced an increasing number of digital fraud cases over the years. According to the Financial Supervisory Authority, total losses from fraudulent card use were 193 million NOK in the first half of 2024. With the nation’s move toward digital and card-based transactions, it’s necessary to invest in sophisticated fraud detection mechanisms such as 3D Secure to protect your business and customers.

Key takeaways

While Norway’s payments infrastructure is intertwined with the EU’s, businesses should pay special attention to the nuanced preferences of the local market. By tapping into these nuances, businesses can elevate the payment experience for their Norwegian customers. Here’s a recap, along with tips on accepting payments in Norway.

Embrace contactless payments

• Lean into BankAxept
  BankAxept, Norway’s national payment card, is widely used. Offer BankAxept as a payment option to benefit from the trust associated with this local system.

• Integrate Vipps payments
  The mobile payment app Vipps can provide a familiar, smooth payment experience for Norwegian customers. Choose a payment gateway that accommodates local mobile payment apps, as well as popular global digital wallets like Apple Pay and Google Pay.

• Use suitable payment terminals
  If your business accepts in-person payments, assure that your payment terminals support contactless payments. Accepting Tap to Pay can reduce wait times and improve transaction speeds.

Improve the checkout experience

• Localize customer support
  Even in a digitally advanced nation like Norway, offering real-time customer support in the local language can make a big difference. Translate your payment interfaces and provide support in Norwegian to assure that language barriers don’t disrupt the payment process.

• Be clear with refunds and returns
  Clear refund and return policies that align with Norway’s Consumer Purchases Act instill confidence in customers. Communicate your business’s rules transparently to minimize potential disputes and help raise conversion rates.

• Consider currency flexibility
  International tourism is common in Norway, as are cross-border B2B transactions. Serve international customers who want to pay in their home currencies by providing multicurrency payment options.

Protect online payments

• Pick a secure payment gateway
  Secure payments begin with a payment gateway that can encrypt and safely transmit financial information such as credit card details. Choose your payment gateway wisely and ensure it meets all of your business’s security needs.

• Authenticate card payments
  Fraud prevention tools such as 3D Secure authentication can fortify your online payment security system without slowing down payments or inconveniencing customers. Implement these protocols to add another layer of protection to ecommerce transactions.

• Regularly update fraud prevention measures
  Regular updates to fraud detection and prevention systems, coupled with customer education on secure payment practices, can go a long way in maintaining a trustworthy payment environment.