Authologic: EU is facing ‘cold start’ with EUDI Wallet

Europe will face the so-called “cold start” problem when it comes to introducing the European Digital Identity (EUDI) Wallet at the end of 2026.

Digital IDs are only valuable when all sides of the ecosystem accept them. However, relying parties, such as banks, public services and private businesses, have no incentive to integrate digital IDs unless there are users. Citizens, on the other hand, have no reason to adopt the wallets unless there are services they can use. It’s a chicken-and-egg problem.

But Europe has a plan, according to Jarek Sygitowicz, co-founder and chief strategy officer of Authologic. The European Commission has decided it doesn’t want to force people to use digital IDs, meaning it is “essentially forcing” companies and governments to move first.

“Businesses are not eager to do anything,” he says. “Typically, when it comes to identity, it’s something that they have to do because of the regulation.”

As a company providing a unified e-ID platform for businesses, Authologic has had a front-row seat at how the EUDI Wallet is being adopted by companies. Digital ID adoption varies significantly among countries, notes Sygitowicz.

In France, the national digital identity app, France Identité, had only 3.2 million issued eIDs in December – a figure too low for businesses to take notice. In Poland, on the other hand, most businesses are eager to integrate the state eID and the mObywatel (mCitizen) app, which now has over 11 million users.

“The situation is uneven across Europe,” says Sygitowicz.

Under EU rules, regulated businesses, such as banks, telecom operators, and public services, must accept the EUDI Wallet as a secure authentication method by late 2027. But other companies, such as hotels, airlines, lawyers and more, will also have to accept digital IDs, he notes.

“We estimate that there are 100,000 businesses in Europe that need to be compliant with eIDAS 2.0 by the end of 2027,” he says. At the same time, there are very few specialists who can help them, creating a mismatch in the market.

Businesses will start integrating the EUDI Wallet this year, and Authologic sees an opportunity for itself. The Warsaw-headquartered startup helps companies streamline Know Your Customer (KYC) and Anti-Money Laundering (AML) processes by providing an aggregation and orchestration layer for eIDs.

This “Stripe for KYC” allows companies to access a wide range of identity verification methods through a single API, including legacy checks such as document scans and liveness detection.

The company has received US$8.2 million in Series A funding from European and American firms, and works with financial, gaming, and betting companies.

Authologic is planning to launch a new app in several weeks, which will work with Apple, Google, Samsung wallets and the EUDI wallets later in the year. Users will be able to add credentials to the wallet and use them to log in to digital banking and authenticate payments.

The timing is crucial. Countries are seeing digital IDs and digital credentials as a way to improve the competitiveness of their economies while boosting cyber resilience: verifying identity through physical documents online is likely to come to an end due to deepfake fraud.

“The whole world is moving to digital credentials,” says Sygitowicz. “The first market that is actually up and running in this is us.”

The EU has been testing digital credentials and digital IDs for uses beyond onboarding and identity verification. Authologic has been involved in the EUDI Wallet Large Scale Pilots (LSPs) as part of WE BUILD, a consortium selected by the European Commission to pilot business and payment interactions across business-to-business (B2B), business-to-government (B2G), and business-to-consumer (B2C) domains.

The startup is one of nearly 200 partners, including Veridas, Raidiam, Izertis and Youverse, EU member states and other public and private sector organizations. ​Alongside others, Authologic has been working to simplify payments for businesses by using wallets for payment authentication, including account-to-account, card payments and even stablecoins.

“For example, you can have a credential that is a DPC, a digital payment credential, and you can pay online using your identity wallet,” says Sygitowicz. “This is super exciting and will have a huge impact on the economy.”

This is one of the reasons why European governments have been so hands-on in making the EUDI Wallet into reality, he adds.

“I see the differences between what we do in the EU versus the UK, for example, and other countries and we are really leading the pack,” says Sygitowicz.

Article Topics

Authologic  |  consumer adoption  |  digital ID  |  digital wallets  |  e-ID  |  EU Digital Identity Wallet  |  WE BUILD consortium