digital-identity
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European Digital Identity to Remove Borders between EU States and Change the Game for European Citizens?

06.07.2021

After the pandemic, it became clear that the current member states’ approach to personal data management is no longer viable. Instead, there should be no data silos, which one could overcome through European cooperation. At this point, the European community warmly welcomed the idea of bridging trust services and digital identities.

Introduction to the Topic

The whole big thing around European digital identities started with the European Commission’s proposal to establish a European Digital Identity framework. The framework is based on the privacy and security principles that have been actively propagated in Europe these last years.

It’s expected that European citizens will have complete control over their data, meaning that they will decide which data to share and with whom. From the structural point of view, each member state already has a solid base to enable the interoperability of digital identities without affecting security.

Using Digital Identity wallets, citizens will be able to store and leverage data across a whole range of services like renting a car, paying for education, getting a loan or insurance, and more. Digital Identity knows no borders, allowing everyone to prove their identity only once and then use services seamlessly within the European Union.

Of course, the potential effects of this framework are more profound than they seem at first glance. Let’s see in more detail how it is going to change the economy and society.

What Does it Mean for Data Security?

Finally, one can store the whole array of dispersed pieces of sensitive data in one place. Over the last years, data security has been quite an issue while commercial and governmentally supported hackers presented a sizable cybersecurity threat to digital identities. Personal information has always been the most valuable hence appealing target to criminals.

But can the new order of things with sensitive data prove itself useful to the business sector? Sure, but SMEs are likely to benefit the most from it. The point is that usually, customers readily share their details with big, well-known companies they frequently deal with. At the same time, there is little trust in the smaller ones since they usually can’t afford sufficient infrastructure and security.

Digital Identity for European Citizens

Digital Identity promises to positively change all sectors of society. Primarily, it should introduce multi-channel access to online services, whether it be the internet or mobile apps. Meanwhile, citizens will be able to perform daily activities much easier than before, thanks to a single proof of identity granting them seamless access to all these services.

For the public sector, the digital transformation of identification data may present two challenges: on the one hand, the authorities will be able to offer greater flexibility to the public; on the other, they will need to provide a better service to clients. This means that besides improving the digital identity, one must make an effort to ensure everyone has it per se.

Digital Identity and Economic Priorities

At the national level, governments seek to further grow the economy and improve financial inclusion to serve citizens reliably, securely, and transparently. They already deploy national identity systems to improve taxation, voting, administration, and other public services and promote private ones to stimulate the digital economy and reduce costs.

A Digital Identity system defines roles and rules each European state should follow, which partially ensures the legal framework for this new system.

But how can these enormous benefits be measured? And can we talk about any measurable indicators at all? So far, we can confidently speak only about ROI. However, the digital identity initiative will bring profits only in the distant perspective as it requires time to modernize and equip each member state with the necessary infrastructure.

The Road to Digital IDs: Digital Governments that Deserve Much Attention

Some countries are already making strides on the way to digital identity. For example, Estonia took the first steps to the digital government as early as 1992, when the country became independent. Its x-road platform is interoperable across decentralized databases, enabling seamless data exchange between public and private sectors. Its citizens use digital signatures to confirm their identities. As a result, the platform allows users to sign contracts digitally, access public services, vote, order prescriptions, and do a lot more from the same location.

Now, more than 2,000 public and private services use x-road, with more than 350 million digital signatures left by today. At that point, Estonia is close to the complete digitalization of sensitive data as almost all medical prescriptions and tax declarations are made online, and most medical records are stored online.

In 2014, the Estonian government introduced the e-residency program that proposed opening some digital public services globally. Since its inception, more than 40,000 e-residents have signed up for the program, and more than 4,000 companies have been created by them. However, the program was highly criticized as it created another opportunity for international money laundering.

But Estonia was not the only country that initiated the digitization process early. In the first half of the 2000s, the Belgian government introduced new e-services that enabled the wide usage of electronic ID cards across various services. But it wasn’t enough to gain adoption, and in 2009, the Belgian authorities launched a series of advertising campaigns and a website to explain the benefits of digital services to citizens.

Given the negative experience of UK’s and some other countries’ digital ID cards with their unreasonable prices that brought the swift end of the initiative, the Belgian authorities set the lowest price possible for their cards to make them accessible to the broader public.

Another demonstrating example was Hong Kong that started a national identity program. Thanks to the strong government support, robust legal framework, and solid infrastructure, the program was an unequivocal success.

Finally, How to Adjust Digital Identity to Legal?

Of course, a Digital Identity program should have a solid legal base under it. Primarily, one should define the following aspects under the program:

  • The validity of contracts and other written documents
  • The compliance of digital signatures with international rules
  • Citizens’ electronic relationship to public services
  • The definition of personal data for each citizen and its protection
  • The rules of the use of biometric databases.

Here at Aetsoft, we are always ready to go the extra mile to keep up with innovations and be ahead of the curve in the end. The results of our efforts are hard to miss: from now on, we proudly introduce our revolutionary Digital Identity solution to remove borders between the EU states and even further. To learn more, please visit our website.

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