Consortium Chosen To Launch Payments Pilot Using EU Digital ID Wallet

December 20, 2022
A multi-country consortium has been chosen to deliver a pan-European cross-border payments pilot, in line with the aims of the EU Digital Identity Wallet programme.

A multi-country consortium has been chosen to deliver a pan-European cross-border payments pilot, in line with the aims of the EU Digital Identity Wallet programme.

The European Commission has selected the NOBID Consortium to serve as one of four forthcoming EU digital ID pilots, receiving funding from the commission’s Digital Europe (DIGITAL) Programme.

The consortium consists of public and private sector partners in six countries, namely Denmark, Germany, Iceland, Italy, Latvia and Norway.

The pilot will be led by the Nordic-Baltic eID (NOBID) project — an offshoot of the Nordic Council of Ministers and the Norwegian Digitalisation Agency — and will be supported by commercial ID verification partners, including the UK’s iProov.

Ahead of the pilot, which will begin in March 2023, the NOBID Consortium must also complete a contracting and grant negotiation process with the commission.

“We are honoured and privileged to have the EU Commission's trust in piloting and shaping the future of digital payments and digital identity in Europe,” said Tor Alvik, project manager at the consortium.

“Together with all our partners, we will make use of our experience and highly mature digital identity infrastructures in the NOBID consortium countries to deliver a successful large-scale payments-pilot of the EU Digital ID Wallet.”

The EU Digital Identity Wallet is a biometrically-secured app that will allow citizens throughout the EU to verify their ID, access both public and private services as well as store sensitive digital documents in one place.

In a statement, the consortium said the pilot will leverage existing infrastructure to enable payment issuance, instant payments, account-to-account transfers and payment acceptance both in-store and online.

NOBID’s solution will also offer strong customer authentication (SCA) and transaction-linking functionality, therefore satisfying the requirements of the revised Payment Services Directive (PSD2).

“The solution builds on a payment request issued by the intended recipient that may be a merchant or a private individual,” said the consortium.

“Several modalities are foreseen to be supported, including QR codes, push notifications and deep linking.”

Additionally, the pilot is also designed to complement EU plans to enhance cross-border payments through new schemes, such as a digital euro and the European Payments Initiative (EPI).

From the banking and payments sectors, the pilot will be supported by: the German Savings Banks Association (DSGV); DNB and BankID in Norway; Nets in Denmark; Intesa Sanpaolo, PagoPA and ABILab in Italy; and Greiðsluveitan in Iceland.

In addition to iProov, other technology partners that will take part include Thales, Signicat, RB, Auðkenni, IPZS, Poste Italiane, Intesi Group, InfoCert, FBK and Latvian State Radio and Television Centre.

Merchants that have agreed to take part include Norway’s Elkjøp electronics retailer and Germany’s REWE Group, one of the country’s largest retail conglomerates.

NOBID expansion

In September this year, when the new consortium submitted its proposal, it said it would be judged on criteria such as the number of wallet users and the number of wallet-issuing countries involved in the project.

It would also be judged on the number of parties and transactions that have already been coordinated in a “pre-production” environment.

Prior to submitting its proposal, NOBID had already harmonised eID solutions in eight Nordic and Baltic countries for cross-border use.

In many of these countries, use of digital ID is already extremely high. As noted by NOBID, over 95 percent of the eligible population of Iceland has either an eID card or app, while over 90 of Norwegian and Danish citizens also use eID.

However, after the commission’s request for large-scale pilots of the EU Digital ID Wallet, NOBID used its existing infrastructure to extend its collaboration to two of Europe’s largest economies, Germany and Italy.

eIDAS 2 incoming

The pilot will give the participants a chance to test-drive the NOBID solution ahead of eIDAS 2, the second instalment of the EU’s Regulation on electronic identification and trust services for electronic transactions in the internal market (eIDAS).

Introduced in 2014 and in force since July 2016, eIDAS provided the first cross-border framework for trusted digital ID for interactions between citizens, businesses and public authorities.

In September 2018, EU-wide recognition of “notified” digital ID schemes began under eIDAS, which obligated mutual recognition of digital ID schemes between member states.

Under eIDAS 2, this system of mutual recognition is set to be upgraded to a fully interoperable EU-wide digital ID system.

This month, as reported by VIXIO, the European Council adopted an eIDAS 2 proposal that has been in the making since June 2021.

In its current form, the proposal requires that EU member states issue a digital wallet under a notified eID scheme, built on common technical standards and following a compulsory certification process.

Dr. Joachim Schmalzl, executive board member of the German Savings Banks Association (DSGV), said eIDAS 2 will be front of mind during the NOBID pilot.

“We are very happy to be part of NOBID and to support the ideas behind it,” he said. “A successful EU wallet and digital identity implementation will be a strong basis for a new European, standardised cross-border digital ecosystem.”

“We therefore sincerely appreciate the early testing of the coming eIDAS 2 regulation in an EU pilot. This new approach will improve the practical usage and success of new policies.”

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