The future of the European Digital Wallet

Namirial’s perspective after the final conference of the Polimi Digital Identity Observatory

(MILAN / SENIGALLIA) – December 5, 2024 – The event “Digital Identity: Spectators or Protagonists?” organized by the Polimi Observatory, once again established itself as a leading reference point in Italy and one of the most authoritative meetings in Europe. The exceptional quality of the content reflects the outstanding efforts of the Digital Identity Observatory’s team, who deserve our commendation. 

Below is a summary of the key considerations and reflections from our participation in the event. 

Diversity in wallet models across Europe

The digital wallet models developed by European governments exhibit significant differences, with varied approaches to collaboration with private players and the creation of market opportunities for European operators. In an ever-evolving geopolitical context, the event highlighted the importance of avoiding fragmentation and overregulation. This aligns with the insights from the Draghi (competitiveness) and Letta (EU single market) reports, emphasizing that Europe’s future hinges on building robust, integrated industrial ecosystems. 

The european wallet: a vision in progress

Paolo De Rosa, a representative from the European Commission, shared updates on the regulatory process, including the recent vote on the first eIDAS implementation acts held on November 21. He outlined the structure of the European wallet, built on three fundamental pillars: 

  1. Digital identity: Ensuring secure identification and authentication for individuals and businesses. 
  2. Data exchange: Enabling the secure sharing of verified attributes across markets and countries.
  3. Digital payments: Supporting seamless and secure transactions, with a focus on the Digital Euro. 

This comprehensive vision extends beyond identity to include attributes and payments, advancing interoperability and security for the European digital market. 

Digital identities: a fragmented landscape

The European digital identity ecosystem remains highly fragmented, with significant variations in user demographics and applications. While countries like the Netherlands, Sweden, Norway and Italy lead in adoption, Germany and Spain have yet to rank among the top 10. 

An analysis of 149 wallets worldwide (31 governmental, 4 private-public, and 114 private) underscored the importance of digital identities and trust services as cornerstones of modern life and contemporary rights. 

Source: Graphic © Namirial – Source of the data in the image: Digital Innovation Observatories of the Faculty of Management of the Polytechnic University of Milan

Different Positions Throughout Europe on Digital Identity 

Across Europe, Member States are adopting varying strategies to comply with eIDAS2 and develop their EUDI Wallets: 

  • New System Development: Countries like Greece and Austria are designing fresh digital identity systems. These nations benefit from not being burdened by legacy systems, enabling faster adoption of innovative technologies. 
  • Integration of Existing Systems: Countries like Belgium and France are merging established systems (e.g., itsme in Belgium, FranceConnect in France) with EUDI Wallet standards. This process is more complex, involving adaptation of pre-existing infrastructure. 
  • Private Sector Partnerships: Nations such as Spain and Sweden are leveraging private expertise to accelerate the rollout of their systems, creating a hybrid public-private model. 

These differences underline the fragmented readiness of EU Member States, where digital maturity and legacy system challenges significantly affect progress. 

Italy’s position on digital identity 

For Italy, the event served as a strategic moment of reflection. The adoption and success of digital identity schemes depend on their convenience for end-users—both in terms of simplicity and tangible benefits—and the incentives provided to ecosystem players. This balance remains the key challenge for the wallet’s future. 

In the Italian context, projections for CIEid (carta d’identità elettronica, electronic ID) adoption highlight a five-year gap if growth rates persist. Meanwhile, SPID (Sistema Pubblico di identità digitale, public system for digital identity) continues to be the backbone of Italy’s digital identity system, recognized as one of Europe’s most successful initiatives in terms of usage. Although SPID primarily operates at a substantial Level of Assurance (LoA Substantial), private providers have driven its widespread adoption through significant investments in outreach, support, and ongoing improvements. 

Notably, data shows that over 91% of Italian citizens prefer SPID for authentication over CIE. However, the high-assurance alternative offered by CIE faces a slower growth curve, raising concerns about meeting regulatory targets under eIDAS 2 for high-assurance services. 

Incentives and roles in the new digital ecosystem 

Italy’s experience offers a valuable lesson for Europe: adoption timelines for digital identity schemes vary greatly, depending on user convenience and ecosystem incentives. These factors will shape the decisions of those choosing to be either spectators or protagonists in this transformative space. 

Namirial’s active participation in standardization efforts and international experimentation underscores the urgency of clarifying incentives for stakeholders. The goal is to trigger the necessary momentum for voluntary adoption by users, attribute providers, trust service operators, and companies.  

The it-wallet and future challenges 

Discussions on the public IT-wallet, seen as a potential evolution of SPID, highlighted Italy’s capabilities. Thanks to recent legislation (Decree-Law No. 19 of March 2, 2024), Italy can contribute significantly to the private component of the IT-wallet, marking a critical step toward national digital innovation. The IT-Wallet represents a critical step for Italy in the evolution of digital identity. Its success will depend on overcoming these challenges while setting an example for other Member States. If executed well, it could not only streamline identity management within Italy but also serve as a model for integrated, secure, and user-friendly digital identity systems across Europe. 

Spectators and protagonists: a new paradigm 

A particularly insightful session explored the potential roles for companies within the European wallet ecosystem, identifying three key positions: 

  • Verifier 
  • Wallet Issuer 
  • Attribute Issuer 

This analysis provided concrete strategies for organizations aiming to transition from passive observers to active protagonists in the ecosystem. 

Our gratitude goes to the Politecnico di Milano’s Digital Identity Observatory for organizing a high-caliber event. Namirial proudly showcased its role as a key player in this field, contributing to discussions that illuminated the challenges and opportunities shaping the future of the European digital wallet. 

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