What is a digital identity?
A digital identity is an electronic representation of a person’s or organization’s verified identity, enabling them to access digital services securely and remotely. It typically includes personal attributes such as name, date of birth, ID document data, or biometric information. In the EU, digital identity is regulated under frameworks like eIDAS, GDPR, and AML5, ensuring trust, data protection, and compliance in identity verification processes.
How do digital identities work?
Digital identity is the foundation of secure digital interactions. It allows individuals to authenticate themselves online, complete remote verification, and access services without needing to appear in person. A digital identity is usually established through electronic identification methods, which may include biometric checks, document verification, or national eID schemes. Once verified, users can reuse that identity across various platforms – this is known as a reusable digital identity.
The importance of digital identity is growing rapidly across sectors such as finance, healthcare, government, education, and e-commerce. It supports customer onboarding, digital contract signing, account recovery, and more – while ensuring full compliance with GDPR for personal data protection and AML5 for anti-money laundering checks. The eIDAS Regulation provides the legal framework for mutual recognition of digital identities and qualified trust services across all EU Member States, enabling seamless and cross-border digital transactions.
Key characteristics
- Represents a person or entity in digital environments
- Verified through identity verification processes such as document and biometric checks
- Enables remote access to digital services and platforms
- Can be reusable, eliminating the need for repeated identity checks
- Legally recognized under eIDAS and compliant with GDPR and AML5
- Used for authentication, eSignatures, and secure onboarding
- May be stored in trusted digital wallets or issued by qualified trust service providers
Examples
- A user verifies their identity once and reuses their reusable digital identity to open accounts with multiple banks
- A student uses their digital identity to access university systems and digitally sign academic forms
- A government platform authenticates citizens through national eIDs linked to digital identity systems
- A fintech app uses biometric identity verification to issue a qualified electronic signature for loan approval
- An employee signs a remote work contract using a digital identity verified through facial recognition and ID document scanning
Related terms
- Qualified electronic signature (QES)
- Qualified trust service provider (QTSP)
- Electronic identification
References
European Commission – European Digital Identity