Speaking at the European Citizens’ Initiativelast month, European Commission Vice-President Maroš Šefčovič saidhe believed that all European Union citizens will be required tocarry electronic identity (eID) cards in the not too distantfuture. With the majority of EU countries already using or planningto implement eID cards in the coming years, one would expect thecomment to go relatively unnoticed.
Several EU countries including the United Kingdom, Denmark andIreland are firmly opposed to eID cards and find Šefčovič’salarming. “The EU should not even consider foisting identity cardsupon us. Some EU Member States may find them useful but in the UKthey have been roundly rejected by the voters,” says Syed Kamall,one of the UK delegates to Brussels.
eID-card proponents say the cards offer numerous opportunitiesthat extend beyond just serving as a form of identification, butinto the payments space and improving governmental efficiency. Forexample, the Portuguese government has been phasing in the nextgeneration identity card. Equipped with a smartcard chip, the newID card can incorporate the function of five othergovernment-issued cards: the old national identity card, thetaxpayer ID card, the social security card, the voter ID card andthe social services card. Besides serving as the main form ofidentification, the new ID card can be loaded with funds from acitizen’s bank account, which in turn can be used to pay one’staxes or other government fees like car registration.
Opponents, however, say privacy concerns are paramount, withpotentially sensitive health records and personal data recorded onthe smartcard. They argue the information stored on the chip cantoo easily be stolen and the cards will provide the government withmore information on its citizens then it requires. Some Europeancountries have avoided forced citizen adoption as a result ofprivacy concerns. While countries such as Denmark and Ireland havesimply rejected eID cards entirely, other countries such as Swedenand Serbia have given their citizens the choice to adopt the cardsor to retain regular cards.
There is no doubt electronic identity cards offer great promise forimproving government payments to its citizens, and from citizens togovernments. Russia is taking eID cards a step further and tryingto make them as useful as regular debit cards, enabling them formass-transit payments and other goods and services. While eID cardsmay be better suited for government payments, the universal eIDcard in Russia highlights the immense potential the cardspresent.
For more information about other payment developments aroundelectronic identity cards, see Mercator Advisory Group’s researchnote titled Global CitizenID Initiatives, published in April 2013. It details the growingEuropean debate on eID cards and examines further paymentdevelopments on electronic ID cards worldwide.