The analysis behind the European Business Wallet proposal, explained

Not a formal impact assessment

Strictly, there is no impact assessment for this proposal. The Commission granted a derogation, on the grounds that the Business Wallets build directly on the policy choice it had already assessed in 2021 for the European Digital Identity Framework, and follow the option preferred then: a harmonised wallet framework with Union-wide legal effect, adapted to professional use. Instead, it prepared a staff working document analysing the expected costs and benefits in detail.[1]

That document, SWD(2025) 837, still follows the familiar structure: problem definition, why the EU should act, objectives, the policy option, its impacts, and how they would be monitored. It is supported by an external study by a consortium led by NTT Data, a survey that received 65 responses from the 340 stakeholders it reached, and 14 in-depth interviews.[12]

The problem it describes

The document identifies two problems. It presents them as a business-focused extension of the problems the 2021 impact assessment for the EU Digital Identity Wallet found for individuals.[12]

• Businesses and public bodies need better ways to identify themselves and prove who may act for them online, especially across borders. Company identifiers issued in one Member State are not always recognised in another. Sole traders, the self-employed and public bodies often fall outside the business registers that assign an EU-wide identifier. And there is no standard EU-wide way to store and check a digital mandate or power of attorney.
• There is no reliable, legally recognised way for businesses to share licences, certificates and compliance data digitally with public bodies and with each other across borders. The same documents are submitted again and again, often by email, courier or proprietary portals, and the EU Digital Identity Wallet, built around personal privacy, was not designed for the traceability businesses need for audits and compliance.

It traces these back to three drivers:[12]

• Market and technological change, from cloud computing and AI to data-driven reporting, creates new needs for trust services among businesses and public bodies.
• As more businesses trade across borders, fragmented national compliance processes multiply their cost.
• Systems that do not work together stop public bodies from identifying and communicating with businesses securely and efficiently.

On why the EU rather than each Member State should act, it argues that national systems are built for domestic use and differ in legal effect, scope and technical design, which hinders the freedom of establishment and the freedom to provide services and distorts competition between businesses depending on where they are established. The legal basis it identifies is Article 114 of the Treaty on the Functioning of the European Union, the same as for the EU Digital Identity Framework.[12]

What it sets out to achieve

The general objective is to help the internal market work properly by reducing administrative burdens for businesses and public administrations through digital identification, authentication and legally valid data exchange. Two specific objectives follow from it:[12]

• Reduce administrative burdens, streamline compliance processes and improve service delivery.
• Ensure businesses and public bodies have access to secure and trusted digital identification across borders, meeting user needs and market demand.

The baseline and the options

The document does not compare several policy options. It takes policy option 3, the option preferred in the 2021 impact assessment for the EU Digital Identity Wallet, and treats it as both the baseline and the only policy option considered, tailored to the needs of businesses and public bodies.[12]

Its reason is coherence: with the EU Digital Identity Framework already in force and its technical architecture defined, it calls the digital identity wallet model the only viable fit for keeping the two kinds of wallet consistent and interoperable, and describes the Business Wallets as an extension of that framework rather than a separate one.[12]

Under that option, public sector bodies would have to enable a minimum set of core functionalities: identification and authentication, qualified electronic signatures and seals, exchanging electronic attestations of attributes, and receiving official notifications. Actions taken through those functionalities would have the same legal effect as on paper or in person. Businesses would not be obliged to use a Wallet, and sole traders and the self-employed could use their EU Digital Identity Wallet for some standalone services instead of buying a full Business Wallet.[12]

The use cases it illustrates

The proposed Regulation itself would be use-case-agnostic: it would not prioritise particular uses. To show how it could work, the document lists use cases identified by stakeholders:[12]

• Customer onboarding and due diligence (know your customer): verified credentials in place of manual document collection.
• Legal representation: issuing, revoking and tracking powers of attorney digitally.
• Public procurement: pre-qualified credentials that can be reused across tenders.
• Running a business across borders: submitting verified credentials to authorities in other Member States without being there in person.
• Tax management and e-invoicing: trusted identifiers and verified VAT credentials.
• Supply chains: linking verified supplier data and product credentials, such as the Digital Product Passport.

The costs it models

Wallet owners would pay one-off costs in their first year (training and onboarding, activation and IT implementation, and procurement or contracting) and a recurring licensing and maintenance fee after that. The Commission estimates the average cost per organisation as follows:[12]

All public sector bodies are assumed to adopt the Wallet, since they would be required to accept it. Across the 95,825 public bodies the model counts, that comes to about €7.3 billion in the first year and about €1.15 billion a year after that. If 75% of businesses adopted it, their costs would total about €45.5 billion in the first year and about €20.4 billion a year after that.[12]

For sole traders and the self-employed using their EU Digital Identity Wallet instead, the document puts standalone services, based on current market prices, at about €45 a year for the new communication channel, with electronic signatures, seals and time stamps priced separately.[12]

The savings it models

Direct benefits are counted only as savings from reducing or removing manual administrative work. They are estimated with the EU Standard Cost Model: hourly labour cost, multiplied by the time an activity takes, how often it is done and how many organisations do it, drawing on survey data and official statistics. The activities fall into six categories:[12]

• Identification and authorisation
• Exchange of documents and information
• Compliance and verification
• Record keeping and data management
• Permissions and certification
• Cross-border coordination and recognition

With all public bodies and 75% of businesses on board, the Commission puts the maximum direct benefit at about €169 billion a year, assuming every manual process is replaced. Its minimum, based on the savings survey respondents expected (22% for public bodies, 36% for businesses), is about €58 billion a year.[12]

Subtracting the costs, the maximum net benefit at that level of adoption would be about €116 billion in the first year and about €147 billion a year after that. On the minimum assumptions, it would be around €6 billion in the first year and around €37 billion a year after that. The document also projects the maximum over ten years, holding benefits constant, to a net present value of about €1,107 billion.[12]

The document runs the same model at lower adoption levels. At the lowest, about 10% of businesses, the total is still positive in the first year, but public bodies would pay more than they save until their one-off costs are absorbed. It calls 75% adoption the most effective and efficient way to meet the objectives.[12]

It also describes indirect benefits, such as less fraud, more trust in digital transactions and lower emissions from paper and travel. Some are quantified and some are left unquantified, and they are kept separate from the direct savings above.[12]

How this relates to the headline savings figures

None of these modelled figures is one of the two headline numbers in circulation. The Commission's press release of 19 November 2025 cites up to €150 billion a year in savings for businesses, and its policy page cites at least €160 billion. The Commission does not reconcile the three.[3][2]

For both headline figures and the adoption levels the model uses, read the savings estimates, explained.

The limits it acknowledges