EU Backs Plans for an EU-Wide Digital Wallet for Secure Online Authentication

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The European Union has backed plans for a new EU-wide wallet, which would enable EU citizens to securely identify and authenticate themselves online without relying on third-party commercial services, addressing concerns related to trust, security, and privacy.

The Digital Identity Wallet would be designed for voluntary use. Throughout the negotiation process, Members of the European Parliament (MEPs) emphasised the importance of protecting citizens’ rights and ensuring the digital system does not discriminate against those who choose not to use the wallet.

Key features of the law include the provision of free “qualified electronic signatures” for users of the EU wallet, offering the highest level of trust and legal equivalence to traditional handwritten signatures. The legislation also facilitates wallet-to-wallet interactions, enhancing the efficiency of digital exchanges.

MEPs advocated for the development of an open-source wallet to promote transparency, foster innovation, and strengthen security measures. Moreover, the law sets rigorous standards for the registration and supervision of companies involved, aiming to guarantee accountability and traceability.

A notable aspect of the wallet is the inclusion of a privacy dashboard, granting users comprehensive control over their data. This feature aligns with the General Data Protection Regulation (GDPR), enabling users to request the deletion of their data.

Following Parliament’s approval with 335 votes in favor, 190 against, and 31 abstentions, the regulation awaits formal endorsement by the EU Council of Ministers to be enacted.

The backdrop to this legislation is the European Parliament research service’s findings that the pandemic has accelerated the digitalisation of public and private services. While existing digital wallet solutions offer the convenience of consolidating data within a mobile environment, they also pose risks related to personal data control and are not linked to a verified physical identity, increasing the potential for fraud and cybersecurity threats.

This legislative move is in direct response to recommendations from the Conference on the Future of Europe, particularly proposals advocating for a unified European digital identity to simplify cross-border digital transactions and services, supported by a comprehensive framework of European standards and guidelines to ensure security and trustworthiness in the digital landscape.

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