Digital wallets are transforming how we pay, interact, and secure our digital identities. As smartphones become indispensable, consumers worldwide are using digital wallets for transactions, peer-to-peer payments, and even managing digital identities like driver’s licenses and health credentials. However, behind the convenience of digital wallets lies a complex network of technology, security, and regulatory challenges.
At Consult Hyperion, we specialize in navigating these challenges, using our expertise at the intersection of identity, payments, and cybersecurity to help clients innovate securely and effectively in the digital wallet space.
Digital Wallets: Expanding Beyond Payments
While digital wallets initially gained traction as payment tools, they have evolved into multi-functional platforms that can store not only debit and credit cards but also digital identities, health passes, travel documents, loyalty cards, and more. Wallets are increasingly integral to the digital identity ecosystem, empowering people to prove who they are, access services seamlessly, and control their personal data with security and transparency.
One emerging trend is the integration of mobile driver’s licenses (mDLs) into digital wallets. As mDLs gain adoption, digital wallets can provide a secure, portable means of identity verification, allowing users to authenticate their identities for various purposes while retaining control over their personal information.
Regional Approaches: United States, Europe and Australia
The adoption of mDLs into digital wallets varies significantly across regions, influenced by differing regulatory environments, market demand, and technological infrastructure. Here’s how digital wallet innovation and mDL adoption is evolving across North America, Europe, and Australia.
United States
The U.S. has been at the forefront of mDL adoption with several state DMVs already rolling out mDLs and several others with programs underway. These digital credentials are starting to be accepted for in-person use cases such as domestic air travel and liquor purchases. And going forwards, they will also be accepted online. Like physical driver’s licences, mDLs will have a lot of utility.
Many states are choosing to work with the large platform wallets, like Apple Wallet and Google Wallet, issuing mDL credentials into the wallets consumers already have. Those wallets are increasingly becoming “digital hubs” where users can store a variety of credentials. But this is not the only solution. Some states have also launched mDL specific apps. These provide consumers with the option of a standalone mobile driver’s licence.
In the middle of all this progress is the American Association of Motor Vehicle Administrators (AAMVA) which is playing an important role coordinating stakeholders and promoting standardized and interoperable approaches.
Europe
Some European countries have local proprietary mobile driving licences…
In the EU, the eIDAS 2.0 regulation requires each country in the EU to provide at least one digital wallet to its citizens, residents and businesses. Those wallets will be required to support for the ISO 18013 standard that underpins mDLs. In parallel, the EU plans to make driving licences mobile by default.
The situation is however complex.
• The EU is developing a rich but complex wallet architecture, of which support for mDL is just one part.
• Many wallets – which will require robust certification processes if interoperability is to be achieved
• Role of OEMs unclear – providing wallets or providing the secure technology to support wallets over the top
The EU wants all of this to come together over the next couple of years, which seems very ambitious.
So whilst wallets look set to play an important role in the EU digital economy, it will be some time before they provide the straightforward utility of US mDLs.
Australia
Australia has also been a leader in mobile drivers licences, several states issuing them.
Austroads, an intergovernmental organization, is driving the development and standardization of mDLs in Australia. They are working with state and territory governments to develop a consistent framework for mDLs, ensuring interoperability and security. This includes alignment with both ISO 18013 (mDL) and the more generic ISO 23220 (mDoc). This should allow the mDL apps issued in Australia to hold other digital credentials in the future. So instead of issuing mDLs into wallets, the mDL will become the wallet.
Austroads is going one step further by building a “Digital Trust Service” – providing the means to check the authenticity of the issuers of digital credentials held in those “mDL wallets”.
The Core Elements of Digital Wallet Success
Digital wallets that can hold both payment credentials and other digital credentials will have huge utility. They will increase convenience, reduce fraud and improve privacy.
Successfully implementing and scaling digital wallets requires expertise in several key areas:
- Security: Security is crucial when handling sensitive information such as cryptographic keys, payment details or digital identity credentials. Consult Hyperion has decades of experience of building and testing secure payments services with expertise in strong cryptography, mobile application security and tokenization.
- Identity: Digital wallets often serve as digital IDs. Users can store verifiable credentials, such as mDLs or health passes, giving them control over personal data. Integrating these digital identity solutions requires navigating regulatory frameworks and ensuring interoperability with existing systems. At Consult Hyperion, we leverage our deep knowledge of standards like Decentralized Identifiers (DIDs) and Verifiable Credentials to design privacy-protective and compliant solutions.
- Payments: Wallets gained popularity as payment solutions, and understanding payment intricacies is essential. This includes managing multiple payment types and adhering to regional regulations. Our expertise spans EMV, contactless, and real-time payment systems, enabling us to help clients integrate and scale secure wallet-based payments globally.
Why Consult Hyperion?
Our ability to bridge the gap between theory and real-world application makes us a trusted advisor for organizations building digital wallets. Our expertise encompasses:
- Strategic Partnerships and Innovation: Trusted by financial institutions, tech companies, and governments, we’ve helped design systems that meet stringent security, usability, and regulatory standards. We understand the strategic goals behind digital wallet projects, allowing us to guide clients in creating solutions aligned with long-term objectives.
- Deep Technical Knowledge: Our technical expertise across identity, payments, and cybersecurity enables us to develop robust solutions, from designing secure protocols to implementing advanced authentication methods.
- Proven Track Record: Our history of delivering projects in both private and public sectors demonstrates our ability to execute at scale. Clients rely on us for our technical capabilities, dedication to quality, and innovative approach.
The Future of Digital Wallets: Shaping the Next Generation
Digital wallets are evolving with advances in biometric security, decentralized identity, and blockchain technology. As wallets move beyond payments, businesses must adapt to new standards for security, privacy, and user experience. Apple, Google, and government-led solutions worldwide are positioning themselves as leaders in the wallet space, each bringing unique strengths to the ecosystem.
Consult Hyperion remains at the cutting edge, helping organizations navigate this dynamic landscape. Whether you’re looking to launch a new digital wallet, expand an existing platform, or secure sensitive data, we offer the expertise and insight needed to support your goals.
Final Thoughts
Digital wallets are becoming vital gateways to secure payments and digital identities across the world. At Consult Hyperion, we’re excited to help shape this future, enabling our clients to create secure, compliant, and user-centric solutions. With our expertise in identity, payments, and cybersecurity, we look forward to partnering with organizations worldwide that share our vision for a secure, interconnected digital world.
