Digital Statecraft Meets Financial Citizenship: The Case of the Eudi Digital Wallet

As modes of digital payment spread (Caliskan 2023; Prasad 2021), a pressing concern for banks is verifying the identities of those making transactions. One way banks are doing this is by linking digital payment systems with state-sponsored digital identity initiatives. These programs have emerged in such diverse locales as Sweden (Schwarz 2017), India (Carrière-Swallow et al. 2022), and Singapore (Yeong and Hardoon 2022). However, we still have much to learn about the specifics of these linkages; how they change the relationship between states, banks, and citizens; and the ways in which these changes are justified.

To explore these developments further, this paper considers another such case of this linkage: that of the EUDI Wallet Consortium, a program which is meant to provide all EU citizens with a smartphone-based “Digital Wallet” by 2025. This wallet is meant to help facilitate cross-border payments by linking existing digital identity programs with digital payment infrastructures. It has also been identified as a possible model for the Digital Euro.

This paper seeks to further our empirical knowledge of how this initiative functions, and how it is justified. Drawing on publicly available planning documents, it first identifies the actors involved in developing the project, details the way the Wallet operates, and considers the changing relations between states and banks that result from its adoption. Second, it explores the reasons given for pursuing the program and the ways the program is justified.

These policies and their associated justifications have implications beyond the European case, as many non-democratic regimes are also pursuing similar initiatives. This suggests a disquieting question: are we observing a convergence in political and financial governance between liberal democracies and non-liberal, non-democratic countries?