Submitting the same evidence repeatedly or carrying out administrative tasks in person: Entrepreneurs find such processes both frustrating and unnecessary. Digital identities could simplify many administrative obligations in the future. They will enable businesses to verify their identity, representation rights, and other details online.

At the European level, two wallet solutions are being developed: the "EUDI Wallet" (EU Digital Identity Wallet), mainly aimed at individuals, and the "European Business Wallet" for companies and other organisations.

However, businesses can also leverage digital identities for purposes beyond their own verification needs: The EUDI Wallet can be beneficial for companies that accept their customers' digital credentials – operating as an acceptance point. For instance, hotels could digitise check-ins instead of manually recording details. Telecom providers can identify customers signing contracts online, eliminating the need to upload ID documents or visit a store in person.

The Legal Framework Is Being Established

The Digital Identities Act, passed by the German Bundestag in mid-October 2026, establishes the legal foundation for the EUDI Wallet in Germany. This will enable individuals to prove their identity and other matters digitally, such as demonstrating that they are acting on behalf of a company. Starting from 2 January 2027, the first EUDI Wallets will be available in Germany with select basic functions.

Simultaneously, the European Commission, European Parliament, and EU Council are discussing a draft regulation for European Business Wallets. Unlike the personal EUDI Wallet, this tool is tailored for organisations. It aims to digitally represent corporate identities, credentials, roles, and representation rights, facilitating the integration of business and administrative processes.

Ensuring Feasibility for All

For smaller businesses using the EUDI Wallet, it must be clear whether the individual is acting privately or on behalf of the company. For example, a small business owner might rent a car privately or book a van for their company. In the latter scenario, both their personal and business identities must be clearly distinguishable – not necessarily requiring two separate wallets.

Reliable data sources are essential for digital corporate identities. The Digital Identities Act currently relies on judicial registers to verify business activities for the EUDI Wallet. However, this is insufficient, as not all companies and self-employed individuals are or need to be registered there.

This affects many smaller partnerships (GbRs) and small businesses. Their representatives should also be able to use the EUDI Wallet for business purposes without registration in the commercial or trade register. Compulsory registration would incur additional costs and effort, such as the required notarial involvement. Alternatives in the form of other suitable data sources and verification pathways should be provided from the outset for all companies when implementing the European Business Wallet.

The Entire Administration Needs to Participate

A digital identity alone does not make a digital administrative process. Businesses only benefit if a process can be fully completed digitally – from identity verification to finalisation. This must especially be considered by municipalities, which are the direct administrative point of contact for many businesses. Which processes can be conducted digitally should not depend on the company’s location or the responsible authority.

Therefore, federal, state, and municipal entities must be firmly integrated into the wallet infrastructure. Municipalities require centralised technical solutions, sufficient funding, and implementation support. Otherwise, a patchwork result could significantly limit the usefulness for companies.

Digital Must Also Be Legally Valid

And: Digital functionality alone is not enough. If a company is unequivocally identified via the Business Wallet and its representation rights verified, processes should ideally also be legally binding through it. Additional national formal requirements, such as unique signature mandates, should not force businesses to resort to separate procedures for the last step. The required security level should correspond to the actual risk level of the process.

This is also part of the European Commission's proposed regulation for the European Business Wallet: Actions performed through the Business Wallet should generally carry the same legal effect as their analogue equivalents.