EUDI Wallet: Why Financial Institutions Need to Act Now

The European Digital Identity (EUDI) Wallet is moving from a concept and experimentation towards implementation. For financial institutions, this means that EUDI is driving urgency with some   very concrete topics: from customer onboarding and strong customer authentication to payment initiation and new value-added services. With regulatory deadlines approaching in 2027 and implementation likely taking more than a year, financial institutions should start preparing now.

The EUDI Wallet is getting real

For years, the European Digital Identity (EUDI) Wallet has primarily been discussed as a future vision for digital identity in Europe. This is changing quickly.

The revised eIDAS Regulation (“eIDAS 2.0”) entered into force in May 2024. Since then, technical standards and specifications have been developed, while the EUDI Wallet is being tested across Europe through initiatives such as the European Large-Scale Pilots, We Build and Aptitude as well as the SPRIN-D sandbox in Germany. etonec is an active member of these initiatives. 

The next major milestone is approaching: EU Member States are mandated to make EUDI Wallets available around the end of 2026. Some first Member States indicated they may launch a couple of weeks later, in January 2027, such as Germany with the launch date of January 2. Financial institutions will then face regulatory requirements to support the EUDI Wallet in their customer journeys by the end of 2027.

That may sound relatively far away. However, for financial institutions needing to start a project across multiple departments, this leaves very little time to meet these mandatory requirements.

Why does EUDI matter for financial institutions?

The EUDI Wallet is much more than just a digital version of your identity card. It will affect several core processes of financial institutions. Customer onboarding and know-your-customer (KYC) processes are obvious examples. But EUDI also touches business onboarding and know-your-business (KYB) processes, login as well as strong customer authentication.

And this covers only the mandatory compliance side.

Once EUDI infrastructure is integrated, financial institutions can also explore additional use cases around payment initiation, age verification, and other value-added payment services, like loyalty or acquiring. This makes EUDI both a compliance topic and a strategic one. The key question therefore should not only be: "What do we need to implement to comply?" but

should also be: "What role do we want to play in the emerging EUDI ecosystem and how can we leverage the EUDI Wallet strategically?"

Why start now?

Because becoming EUDI-ready takes time.

In our work with financial institutions, we see that EUDI affects many parts of an organization at the same time: payments, onboarding, compliance, risk, IT, product and strategy - just to name a few departments. Treating it as an isolated IT or compliance project therefore falls short.

A typical - very simplified - journey towards EUDI readiness involves five steps

First, governance needs to be established. Someone needs to take ownership of EUDI within their organization and bring together the relevant teams.

Second, institutions need to define their strategy: Which use cases matter? Which role should the institution play in the ecosystem? What should future customer journeys look like? And where is the business case? Find expert help externally if you do not have the skill sets within your organization.

Third comes the "make or buy" decision. Institutions need to determine which capabilities they want to build themselves and where they want to rely on external providers.

Only then can implementation and integration start, followed by piloting, testing and ultimately the launch across relevant EU markets.

Taken together, we estimate that this journey can take approximately 14–22 months, depending on the institution, its ambitions and its existing infrastructure.

This puts the remaining timeline into perspective.

What should financial institutions do now?

There are three things I would prioritize. First, establish governance. Appoint a clear EUDI project lead, secure the required resources and set up a cross-functional core team. Second, define an EUDI strategy. This should go beyond regulatory compliance and cover also strategic use cases, the institution's role in the ecosystem, the target vision and the underlying business case. Third, start a dedicated compliance stream in parallel. Regulatory requirements and technical specifications are evolving, but institutions need to understand today what will be required from them and where implementation dependencies exist.

2027 is closer than it looks

The national EUDI Wallets are only a couple of months away from their launches. For financial institutions, this creates both an obligation and an opportunity. At a minimum, they need to prepare for upcoming requirements around onboarding and authentication. Strategically, however, EUDI can become much more: a new infrastructure layer for identity, authentication and payments across Europe.

The challenge is timing. With an estimated 14–22 months required to move from initial governance to implementation, testing and launch, there is not much buffer left. Banks, PSPs, Telcos and other critical providers are required to be EUDI-ready by December 24th, 2027. That is just only a little over a year away!

For financial institutions that have not started yet, the message is therefore quite simple:

Now is the time to get EUDI-ready.

This article is based on a German-language webinar on the EUDI Wallet that we recently hosted together with YPOG. The webinar provided an overview of the current state of EUDI, the timeline ahead, and what financial institutions should do now to prepare for implementation.