Digital IDs: what they are, why they matter and how to use them
Stefan Gajewski
Head of Product, Identity
Digital IDs are no longer a future concept – they’re already transforming how people onboard, pay and access services around the world. For compliance leaders, fraud teams, product managers and KYC experts, the conversation has moved on. The question is no longer ‘what’s a Digital ID?’ – it’s ‘how do we use Digital IDs to onboard more genuine customers without adding friction?’
In this article, we’ll explore:
- What is a Digital ID?
- Why now is the time to explore Digital IDs
- The impact Digital IDs can have on your business.
- How Digital IDs fit alongside your existing KYC stack
- Practical steps to adopt them in a way that drives conversion and compliance
Whether you're just starting to explore Digital ID solutions or looking to optimise your current approach, this blog will help you unlock their full potential.
What is a Digital ID?
A Digital identity is a certified, verified credential issued by a trusted authority (e.g., government, bank, or private provider) that allows individuals to prove their identity online securely and instantly. These identities are then manifested in digital documents stored in your phone’s digital wallet – which is commonly known as a Digital ID.
Digital IDs enable deterministic authentication, ensuring credentials are verified with certainty rather than probability. This allows businesses to rely on tamper-proof, pre-validated credentials issued by trusted sources. As a result, they can shift focus towards enhancing customer journeys using additional identity and fraud intelligence, delivering greater confidence in identity proofing as fraud prevention technologies continue to advance.
While the fundamental definition of a Digital ID is the same across the global, there are important considerations for different regions:
- In the United States, Digital IDs are most commonly implemented as mobile driver’s licenses (mDLs) issued by individual state governments. They’re designed to be used for identity verification at locations like TSA checkpoints and government services. However, due to the lack of a unified national standard and users are often still required to carry physical IDs as a backup.
- Across Europe, Digital IDs are typically government-verified credentials that serve multiple functions including identification, authentication, and digital signing. These credentials are issued by national governments (e.g., Denmark’s MitID), financial institutions (e.g., Sweden’s BankID), or certified private providers under frameworks like the UK’s Digital Identity and Attributes Trust Framework (DIATF).
- In Asia Pacific, Digital IDs are often part of national-scale identity programs that combine biometric and demographic data for secure verification. These systems are typically centralised and government-issued, such as India’s Aadhaar or China’s national ID initiatives. Digital IDs in Asia Pacific are used extensively for accessing financial services, healthcare, tax systems, and digital payments.
Ultimately, Digital IDs are about trust, speed and access. They simplify onboarding, enhance security and empower individuals to engage in a safer, more inclusive digital economy. Given the increasing adoption of Digital IDs and slight variations on how regions are implementing them, a comprehensive and adaptable approach to validating a Digital ID is key.
Onboarding doesn’t have to be complicated.
Our guide to shows you how Digital IDs can streamline customer journeys, boost conversion, and keep things simple for your team and your users.
Why do Digital IDs matter now?
Digital IDs turn previously one‑off identity checks into reusable, tamper‑resistant credentials people can share instantly from their phones. Issued by trusted authorities (for example, governments and banks), they let you accept pre‑verified identity information in seconds. That creates three immediate benefits for onboarding:
- Faster conversion: Customers verify using credentials they already hold, which removes manual data entry and document upload steps.
- Lower operational cost: Reusable credentials reduce repeat checks and manual reviews.
- Stronger assurance: Cryptographically bound claims from authoritative issuers increase confidence and help minimise synthetic and impersonation attempts.
Critically, Digital IDs don’t replace all other methods everywhere. They complement your current approach, sitting alongside data checks, document verification and fraud signals, so you can route each applicant via the shortest, safest path to a pass.
Where are Digital IDs gaining traction?
Adoption is growing across regions with different models and maturity. A pragmatic strategy is to use Digital IDs wherever they are strongest and maintain intelligent fallbacks elsewhere.
United Kingdom: A voluntary trust framework – the Digital Identity and Attributes Trust Framework (DIATF) – sets a high bar for privacy, security and fraud controls, enabling reusable identities across public and private services. With the launch of the UK Government Wallet and the Prime Minister’s September 2025 announcement of a new national Digital ID scheme for all UK citizens and legal residents – known as the ‘Britcard’ – Digital IDs continue to spark widespread debate across the UK.
European Union: eIDAS 2.0 is catalysing wallet‑based credentials that combine identification, authentication and qualified signatures. By the end of 2026, all EU Member states will need to provide their citizens with an EU Digital Identity Wallet (EUDI). As wallets roll out, expect more cross‑border use cases and higher user expectations for seamless, consented sharing.
Unites States: The U.S. is taking a different path to Digital ID adoption – rolling out mobile driver’s licenses (mDLs) state by state, not nationally. But it’s gaining serious ground. Today, 41% of Americans live in states where mDLs are already live, and 76% are in states where programs are either active or in progress.
Louisiana kicked things off in 2018, with Arizona close behind in 2020. But it’s in 2024 and 2025 that momentum has really taken off. With major states like California, New York and Virginia now on board, mDLs are reaching more people – and reshaping how identity works at scale.
Nordics and Baltics: The Nordic region continues to set the pace for Digital ID adoption, with countries like Estonia and Denmark showing what’s possible when trust, technology and public engagement align.
Estonia has been a pioneer since 2002, when it launched one of the world’s first national Digital ID cards. Today, Estonians use their Digital IDs to vote, pay taxes, and access banking services – all backed by strong digital literacy programs in schools and a commitment to keeping analogue options available.
Denmark, despite never having a physical national ID card, has steadily built its digital identity infrastructure since 2001. Its latest version, MitID, launched in 2022, offers a more secure and inclusive experience available as a smartphone app, code display or audio reader to ensure accessibility for all.
Other global examples: Government‑backed digital identities in places like the Middle East, Latin America and parts of Asia, show how high‑assurance credentials can become part of everyday life - driving both security and customer experience.
Your onboarding should be ready to accept Digital IDs where customers already have them and smoothly switch to documents or data where they do not.
Digital ID verification: From complexity to competitive advantage
Identity leaders face a complex reality: multiple schemes, formats and levels of adoption by country and sector. The competitive advantage comes from accepting a wide range of Digital ID systems through one orchestration layer and intelligently falling back to documents or data where needed.
With our adaptive identity platform, GBG Go, you can:
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Accept trusted Digital IDs today via a single integration and be ready for new networks as they launch.
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Tailor journeys by market, product and risk so the right customer gets the right check at the right time.
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Layer fraud and risk modules (for example, device, behavioural or network reputation) to protect against account takeover and synthetic identities.
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Stay regulation‑ready with configurable controls and clear audit trails.
This approach turns a fragmented ecosystem into a flexible advantage: you accept more genuine customers on day one and adapt fast as regulations and schemes evolve.
What great looks like: the right check, at the right time
Digital IDs are most powerful when orchestrated inside an adaptive workflow. Here is the pattern we see working best for KYC and fraud teams:
- Offer Digital ID first where available
If the applicant has a recognised wallet or bank credential, they can verify instantly. This improves pass rates and reduces drop‑offs.
- Apply dynamic risk signals upfront
Use device, network and behaviour to set risk thresholds. Good customers pass fast; higher‑risk profiles trigger step‑ups.
- Layer intelligent fallbacks
If a Digital ID is unavailable or insufficient for the jurisdiction or product, route to document capture, data verification, or both.
- Automate pass/fail decisions and minimise review
Drive decisions in‑journey with clear explanations and a full audit trail. Reserve manual reviews for genuinely ambiguous cases.
- Continuously learn and optimise
Monitor conversion, fraud, false positives and time to decision. Adjust the journey by market to maximise ROI.
This blueprint balances growth and governance without burdening customers, or your compliance team.
How GBG Go helps you operationalise Digital IDs
One connection, worldwide adoption
Connect once to GBG Go and configure the Digital IDs module to accept a broad set of government and bank‑issued credentials. As new networks emerge, you can adopt them rapidly without rebuilding your stack.
Accelerate onboarding for every genuine customer
Let customers verify in a few taps using credentials stored in their smartphone wallets. Where needed, fall back to documents or data flows to keep the journey moving and reduce abandonment.
Support inclusion and reduce bias
Accept multiple Digital ID formats and route applicants through the most accessible path for their market. This helps you reach hard‑to‑verify customers while maintaining assurance.
Stay compliant as regulations evolve
GBG Go provides compliance‑by‑design orchestration. You can adapt workflows to local KYC/AML rules, manage data residency and retention, and maintain comprehensive decision audit trails for regulators.
Strengthen fraud defences
Digital IDs are tamper‑resistant and pre‑verified, and within GBG Go you can layer risk intelligence modules from device and behavioural analytics to cross‑industry reputation signals to detect account takeover, deepfakes and synthetic identities earlier.
Outcome: More genuine customers pass first time, high‑risk applicants are stepped up or stopped, and your cost per acquisition and review burden go down.
Digital IDs across industries
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Fintech and banking: Speed up KYC for current accounts, savings and lending by accepting bank‑issued IDs where available, with instant pass or targeted step‑ups.
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Payments and wallets: Reduce top‑up and limit‑increase friction while meeting AML obligations across jurisdictions.
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Gaming and gambling: Combine age and identity verification in one low‑friction step; reduce abandonment and manual reviews.
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Telecoms and utilities: Verify at sign‑up to prevent fraud and streamline service activation.
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Marketplaces and mobility: Enable safe, fast onboarding for both sides of the platform; strengthen trust and reduce support costs.
Use Digital ID verification to get ahead of the competition
Customers increasingly expect an instant, wallet‑style verification moment. Regulators are enabling trusted reuse and stronger authentication. Fraudsters are industrialising their methods. Waiting adds cost: abandoned applications, heavier review queues and higher exposure to synthetic identities and account takeover.
Adopting Digital IDs through GBG Go lets you move quickly and confidently, accepting more genuine customers now and staying ready for what comes next.
Frequently asked questions
A Digital ID is a reusable, verified credential issued by a trusted authority such as a government or bank that lets a person prove who they are online in a secure, consented way from their device.
Digital ID verification is the process of accepting and validating a person’s Digital ID during onboarding or authentication. It checks the credential’s integrity; confirms it belongs to the right person and ensures it meets the required assurance level for your product and jurisdiction.
They allow instant sharing of pre‑verified identity data, which removes manual form‑filling and document uploads, increases pass rates, cuts drop‑offs and reduces manual reviews.
Yes, Digital IDs are designed to be tamper‑resistant and cryptographically protected. In GBG Go you can further strengthen security by layering device, behavioural and fraud intelligence, plus step‑up checks where risk is higher.
Not everywhere. Adoption varies by market. The most effective approach is to offer Digital IDs first and fall back to documents or data where needed, automatically orchestrated in GBG Go.
