The European Digital Identity Wallet is set to become a cornerstone of the EU digital single market, redefining how identity, trust, and compliance are managed across financial services. Far from being a purely regulatory requirement, the EUDI Wallet introduces a harmonised, high-assurance identity layer that enables secure, cross-border digital interactions at scale. Its adoption under the eIDAS 2.0 framework creates new opportunities for financial institutions to streamline onboarding, reduce risk, and expand services across Europe
The European Digital Identity Wallet (EUDI Wallet), introduced under the eIDAS 2.0 Regulation (EU) 2024/1183, represents one of the most significant structural changes to digital identity and trust services in Europe in decades. While often perceived primarily as a regulatory obligation, the EUDI Wallet should instead be understood as a foundational infrastructure capable of reshaping how financial institutions interact with customers, manage risk, and scale services across the European Union. By the end of this 2026, every Member State will be required to provide its citizens with at least one EUDI-compliant digital identity wallet, establishing a harmonised identity layer across the single market and creating a shared baseline of trust for both public and private sector services.
Under Article 5f of the eIDAS Regulation, regulated entities, including banks, payment institutions, and other financial service providers, will be required to accept the EUDI Wallet as a method of authentication for Know Your Customer processes by 24 December 2027. This obligation effectively standardises access to high-assurance digital identity across the EU and supersedes the fragmented national electronic identity schemes currently in use, such as itsme in Belgium, SPID in Italy, German ID in Germany, BankID in Nordic countries, Cl@ve in Spain, and FranceConnect+ or La Poste Digital Identity in France. The EUDI Wallet is therefore not an incremental improvement, but a systemic evolution that introduces interoperable, government-backed digital identity and attribute verification into the core of financial services.
A multifunctional trust wallet
Beyond identity verification, the EUDI Wallet is increasingly positioned as a multifunctional trust container. Ongoing policy discussions and technical specifications include the potential integration of payment-related capabilities, including future digital euro use cases. This convergence of identity, attributes, authentication, signatures, and payments within a single trusted wallet significantly increases the strategic importance of the EUDI Wallet for financial institutions seeking to simplify user journeys, reduce fraud, and enable new digital business models.
Financial institutions today operate under growing pressure from multiple directions. Customer onboarding costs continue to rise due to increasingly stringent regulatory requirements, sophisticated fraud techniques, and the operational burden of manual or semi-automated identity verification processes. At the same time, users expect fast, intuitive, and frictionless digital experiences comparable to those offered by global technology platforms. Balancing regulatory compliance, security, and user experience across multiple jurisdictions remains one of the most persistent structural challenges in the European financial sector.
Traditional onboarding and KYC processes often involve repeated document uploads, biometric checks such as selfies, anti-money laundering screenings, and manual verification steps that delay account opening and increase abandonment rates. Payment flows introduce additional complexity, as institutions must ensure strong customer authentication, reduce fraud risk, and minimise transaction drop-off. These challenges are further amplified in cross-border scenarios, where divergent national regulations and identity frameworks complicate customer verification and credit assessment. At the same time, competitive pressure is intensifying, as both incumbent banks and emerging fintech players prepare to integrate the EUDI Wallet and redesign their digital service architectures accordingly.
Against this backdrop, the EUDI Wallet functions as a powerful catalyst for transformation. By providing access to verified, tamper-resistant identity and attribute data issued or endorsed by trusted public authorities, the wallet enables financial institutions to fundamentally rethink onboarding, authentication, and service delivery. Instead of repeatedly collecting and validating customer data, institutions can rely on high-assurance credentials that are portable across borders and reusable across services. This shift has direct implications for operational efficiency, fraud reduction, regulatory confidence, and customer satisfaction, positioning the EUDI Wallet as a genuine growth accelerator rather than a compliance cost.
Still a lot of work ahead
However, realising this potential requires more than regulatory alignment. Implementing EUDI Wallet-based services demands expertise in new technical standards, cryptographic protocols, wallet architectures, and compliance frameworks that continue to evolve rapidly. Institutions must ensure interoperability across Member States, align with the EU Architecture Reference Framework, and maintain security and availability at scale. In parallel, they must attract and retain highly specialised talent capable of designing, operating, and continuously updating mission-critical digital identity infrastructure. For many financial institutions, building and maintaining such capabilities internally risks diverting focus and resources away from core business priorities, including product innovation, customer engagement, and market expansion.
This reality elevates the importance of strategic partnerships. Rather than addressing the complexity of the EUDI ecosystem in isolation, financial institutions can leverage pan-European platforms specialised in regulated digital trust services. Platforms such as the Namirial Wallet Platform provide the necessary software development kits, application programming interfaces, cryptographic services, and operational infrastructure required to integrate seamlessly into the EUDI ecosystem. This approach enables institutions to adopt EUDI Wallet capabilities efficiently, without assuming the full technical, regulatory, and operational burden of in-house development and maintenance.
Through this lens, the EUDI Wallet becomes an enabling layer rather than a regulatory constraint. Institutions can concentrate on delivering differentiated financial products and services, while relying on proven infrastructure and expert teams to ensure compliance, resilience, and innovation across jurisdictions.
The impact of the EUDI Wallet extends across several core financial processes. In KYC and onboarding, institutions gain immediate access to verified identity data that is cryptographically protected and sourced directly from trusted public authorities, enabling customer verification across all EU Member States with a consistent level of assurance. In the context of strong customer authentication, credentials such as Payment Attestations cryptographically bind transaction data to the authentication process, significantly reducing the risk of fraud and unauthorised transactions. Verifiable Attribute Attestations, including Qualified Electronic Attribute Attestations, allow legally recognised attributes such as income, address, or professional status to be stored and presented from the wallet. Accepting these attestations enables fast and reliable verification for credit assessment, lending, and compliance processes, while issuing attestations allows institutions to create reusable credentials that customers can present to trusted third parties. Qualified electronic signatures further extend these capabilities by simplifying identification and certificate issuance through reliance on qualified trust service providers and verified wallet credentials.
From a strategic perspective, the EUDI Wallet enables financial institutions to move beyond traditional account-based services and evolve into trusted digital hubs. By storing and verifying a wide range of attributes, from personal identity data to financial and professional credentials, institutions can develop new products that are both highly secure and deeply personalised. Customers benefit from a single, trusted access point to multiple services, while institutions reduce friction and operational duplication across product lines such as payments, credit, mortgages, insurance, and card issuance.
The broader identity ecosystem remains fragmented
Most banks and financial service providers continue to operate isolated KYC, AML, and onboarding infrastructures, each with its own processes, certifications, and maintenance requirements. The EUDI Wallet does not automatically eliminate this fragmentation. Instead, it introduces a new shared framework that must be implemented thoughtfully to avoid replicating inefficiencies at a higher level of complexity.
A consortium-based credential hub model offers a scalable and efficient response to this challenge. In such a model, multiple financial institutions collaborate within a shared governance and technical framework. Each institution integrates a standardised SDK into its mobile or web application, effectively transforming it into a compliant EUDI Wallet interface while preserving control over branding and customer experience. Credentials are managed securely in the background, with the customer experiencing a seamless and unified journey.
The central innovation of this model lies in a shared backend infrastructure for wallet secure cryptographic devices. Credentials issued by one consortium member become immediately usable across all participating institutions, eliminating redundant onboarding and document verification. Attributes issued by different entities can be aggregated to create richer identity profiles, enabling access to more complex products such as mortgages, consumer credit, or insurance with minimal additional friction. Institutions benefit from shared certification, security, and operational costs, while maintaining full alignment with European architectural and regulatory standards.
The consortium model can be extended beyond financial institutions to include telecom operators, energy providers, and other regulated sectors. This expansion creates an intersectoral identity and attribute ecosystem in which the same verified credentials are reusable across multiple domains, simplifying interactions for both consumers and service providers while increasing the overall value of the wallet infrastructure.
The economic implications of this architecture are substantial. Frictionless onboarding reduces abandonment rates and lowers customer acquisition costs. Credential reuse enables multi-issuer trust scenarios that support more sophisticated risk and eligibility assessments. Each participant retains control over its own customer base and wallet application, while benefiting from shared infrastructure and interoperability. Cross-border and cross-sector onboarding becomes significantly simpler, supporting rapid expansion and innovation. Verification itself becomes a monetisable service, as relying parties can be charged for instant, high-assurance credential verification.