eIDAS Regulation: Opportunity or constraint for companies?

Adopted in 2014, the eIDAS (Electronic Identification, Authentication and Trust Services) regulation laid the foundations for a regulatory framework for the recognition of electronic identities and digital signatures within the EU. Its aim was to facilitate secure digital exchanges between citizens, businesses and administrations, while guaranteeing interoperability between member states.

However, its adoption remained limited, mainly because only certain public administrations were required to recognize these electronic identities, but also because private companies were not really involved in the process.

Faced with these limitations, the European Commission has introduced eIDAS 2 a major development that requires certified digital identities to be accepted throughout the European digital ecosystem, and strengthens requirements in terms of cybersecurity and interoperability.

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The European Digital Identity Wallet (EUDIW): a key innovation

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The wallet offers a solution for :

• Fast, secure identification to access public and private online services.
• Strong authentication without having to store personal information on third-party servers.
• Selectivedisclosure: users can choose which information to provide, depending on the service requested (for example, to prove their majority without sharing their full date of birth).

EUDIW is interoperable on a European scale, and can be used for both administrative purposes (tax declarations, access to public services) and commercial purposes (opening a bank account, car rental, electronic signature).

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Publication of eIDAS 2 implementing acts: towards practical application

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A European regulation such as eIDAS 2 defines a general framework, but it is the implementing acts that specify how it is to be applied. These acts, published progressively by the European Commission, detail the technical standards, security requirements and interoperability protocols to be respected by companies and member states.

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What are the obligations and benefits for companies?

With the eIDAS regulation, companies operating in the European Union will have to comply with a set of obligations designed to ensure secure, harmonized use of digital identities, by 2027.

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Obligations for large platforms and companies

These are platforms with +45M monthly active users that require user authentication.

1. One of the main requirements is the recognition of eIDAS 2-compliant digital identities for online services.

This means that any company offering services requiring identification - be they banks, healthcare services, e-commerce platforms or public administrations - will have to be able to accept certified electronic identities, and therefore require their users to log in with a European wallet.

2. In addition, companies will need to ensure that their infrastructures are EUDIW-compatible, a technological challenge that will require adaptations in terms of access management and identity verification.

3. Compliance with eIDAS 2 also implies meeting stringent requirements in terms of cybersecurity and data protection, which will enhance the security of exchanges, but will require investment to adapt information systems.

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The benefits

Despite these obligations, compliance with eIDAS 2 offers companies several advantages:

• Easier access to European markets, by removing the barriers posed by differing regulations on digital identification.
• Simplification and acceleration of identity verification processes, particularly in sectors where such checks are mandatory, such as finance(KYC - Know Your Customer) or supplier onboarding(KYS/KYB - Know Your Supplier/Business).
• Another major benefit is to reduce the risk of fraud and identity theft.

Faced with the rise of deepfakes and the risks associated with generative AI, eIDAS 2 establishes a robust framework guaranteeing secure, unforgeable digital identities, thus preventing any attempt at usurpation based on advanced image and voice manipulation.

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By introducing verified and secure identification mechanisms, this regulation strengthens the fight against these threats, while consolidating user confidence in digital services.

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What are the challenges facing companies?

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While there are many advantages to the eIDAS regulation, its adoption will not be without its challenges.

1) The cost of implementation for Member States and TSPs

The transition to eIDAS 2.0 means that Member States and Trusted Service Providers (TSPs) will have to make substantial investments in infrastructure, certification and interoperability.

2) The need to raise citizens' awareness of digital identity

Massive adoption of digital identity will not be possible without raising citizens' awareness of the benefits and uses of the European identity portfolio.

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3) The need to guarantee the security and confidentiality of personal data

With eIDAS 2.0, the protection of personal data is a central issue. The implementation of robust encryption, authentication and identity governance mechanisms is essential to prevent cyberthreats and ensure that citizens have total control over their information. Trust in the system and its widespread adoption depend on it.

Although challenges remain, the adoption of digital identity technologies is progressing, with 42% of global organizations having already integrated these technologies into their systems, and a further 31% in the process of implementing them*.

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Conclusion: a transformation that needs to be anticipated now

While the eIDAS regulation consolidates the digital identity of European citizens, attention is now turning to legal entities, in anticipation of a suitable regulatory framework.

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While compliance may seem restrictive, it actually represents a strategic opportunity: automating and simplifying processes, reducing costs, improving security and boosting user confidence. What's more, it is part of a global drive to align European policies to meet the challenges of the global digital economy.

Companies that adapt today won't just meet regulatory requirements: they'll be ahead of the game, offering services that are safer, smoother and in step with market trends.

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*BusinessWire, 2024

**IdentityWeek, 2025

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