The announcement followed a report on Monday of a 16-year-old who was refused a blanket on the recently launched Oslo-New York route since he had only cash and no credit card with him to pay $5 for a blanket.
Daily Aftenposten had previously written about a Thai woman whose cup of coffee was taken away after the Norwegian crew discovered she had only cash and a local credit card. She was also unable to buy food or water on the 12-hour flight.
The incidents prompted outrage in the Scandinavian country, and the budget carrier backtracked on Wednesday and said water would be free on long-haul routes and that cash payments would also be accepted.
"Of course, we're very concerned about the well-being of our passengers," company spokesman Lasse Sandaker-Nielsen told AFP.
The changes will not affect short and medium-haul routes, where the airline will continue to require credit cards on "most" flights.
Since its launch around 10 years ago, Norwegian has expanded aggressively at the expense of its main rival, ailing Scandinavian carrier SAS, which has teetered on the brink of bankruptcy.
Only a handful of budget airlines operate long-haul routes and passengers are sometimes surprised to discover that they have to pay for services which other carriers offer free of charge.