By the end of 2026, every EU member state is required to make at least one European Digital Identity Wallet available to its citizens and residents, free of charge. The wallet, created by the revised eIDAS regulation, is a phone app that holds a verified digital identity along with documents such as a driving licence or diploma, and lets the user prove who they are online and in person.

Why it matters for payments

The wallet is not a payment method, but it is designed to work with payments. The regulation requires private companies that are legally obliged to use strong customer authentication to accept the wallet when a customer chooses to use it. In practice that covers banks and payment providers, which will have to support it for logging in and approving payments. This obligation follows after the wallets themselves launch, giving the financial sector additional time to integrate.

For payment firms the wallet has two main uses:

• Onboarding. Opening an account with a verified government-issued identity, without scanning documents or recording a video.
• Authentication. Approving a payment with the wallet in place of a banking app or a one-time code.

EU-funded large-scale pilots have been testing payment use cases alongside travel and education.

Not every country will be on time

Readiness varies widely. Reporting earlier this year indicated that the European Commission doubts all member states will launch on schedule, and industry observers expect only a limited number to meet the deadline in full. France, Germany and Austria are regarded as well prepared. Poland plans to build the wallet into its widely used mObywatel app, and the Netherlands has said its first release will not meet every requirement. Early versions are expected to focus on identification and age verification, with further functions added later.

What it means for businesses

Payment providers and banks should already be planning how to accept wallet-based identification and authentication, because the technical standards are new and differ from current login methods. For online merchants the effect is indirect but useful: faster customer onboarding, a reliable way to verify age where the law requires it, and, over time, a consistent authentication experience for customers across all EU countries.

Sources: European Commission, Biometric Update, Namirial.