The Linux Foundation‘s European off-shoot has formally launched the OpenWallet Foundation (OWF), a new collaborative effort designed to support interoperability between digital wallets through open source software.
The launch comes some five months after the Linux Foundation first revealed plans to set up the OWF, shortly before it spun out a region-specific entity called the Linux Foundation Europe which is where the OWF will now officially reside.
While the likes of PayPal, Google and Apple are among the most recognized digital wallet providers, allowing consumers to conduct financial transactions in-store or online, digital wallets are increasingly being used to store all manner of virtual goods, from student ID to driving licenses. On top of that, burgeoning technologies such as the metaverse and crypto are giving rise to greater use cases for digital wallets.
But one thing all these various environments have in common is that the incumbent digital wallets, for the most part, don’t play nicely with each other: an Apple Pay die-hard can’t send money to their Google Pay brethren. And that is why the OWF is setting out to create an “open source engine” that can power interoperable digital wallets across myriad use cases, including identity, payments and storing personal credentials such as employment and education certification.
Alongside today’s launch, the OWF and Linux Foundation also published a new report to highlight the importance of a more open digital wallet ecosystem, noting that the total value of all digital wallet transactions was $15.9 trillion in 2021. The market is significant, as is the need to help companies avoid vendor lock-in, which is one of the OWF’s core selling points.
It’s worth stressing that the OWF won’t be building a digital wallet itself, or developing new standards — it wants to create the technological core that any other third-party can use to power their own digital wallets.
The OWF was the brainchild of Daniel Goldscheider, CEO of open banking startup Yes.com, who spearheaded the project’s initial development as it was incorporated into the Linux Foundation.
“We are really focusing on the layer between the standards and the wallets, we will not create standards, and we will not create a wallet, we are focusing on open source software on top of those standards, but underneath the wallets,” Goldscheider told TechCrunch. “And our role model really is the browser engine. What’s interesting about browser engines is that they’re not one thing, when you zoom in there is a lot going on — there is HTML and JavaScript and audio codecs and video codecs. So the same is true for the OpenWallet Foundation. There will not be one OpenWallet codebase, or one OpenWallet architecture.”
So what we’re talking about here is multiple different projects, running in tandem, incorporating different languages designed for different digital wallet use cases.
Europe bound
That the OWF has elected to set up shop under the auspices of the Linux Foundation’s European operation is notable. Indeed, Europe is spearheading a broader push against the “walled garden” ethos of big tech, and is currently forging ahead with new rules to enforce interoperability between messaging platforms, while the U.S. is carving out similar plans via the ACCESS Act.
Specific to the OWF’s goals, however, Europe is also looking to incorporate digital wallets into its existing eIDAS (electronic identification, authentication and trust services) regulation, effectively giving all EU citizens a single digital identity to carry out transactions and verification across all companies and public administrations. The European Commission also recently set out the specifications required to develop an interoperable Europe-wide Digital Identity Wallet based on common standards.
And it’s against that backdrop that the OWF has launched with the backing of a host of parties with a vested interest in a more open digital wallet infrastructure.
Initial OWF sponsors and “premier” members include Visa, Avast’s parent company Gen Digital, Accenture and Huawei’s U.S. R&D subsidiary Futurewei Technologies, which apparently pay a €200,000 ($213,000) annual fee that gets them voting rights on the Technical Advisory Committee and Outreach Committee — rights not afforded to those on lower membership tiers. Indeed, “general” members pay up to €50,000 per year depending on how many employees they have, with initial participants including American Express, Deutsche Telecom, Swisscom, Thoma Bravo-owned Ping Identity, Spruce, Esatus, Fynbos, IDnow, IndyKite and Intesi.
Elsewhere, the OWF also offers associate and government tiers, with initial members including Massachusetts Institute of Technology (MIT) Connection Science, OpenID Foundation, DIDAS, Hyperledger Foundation, Johannes Kepler University Linz, Identity 2020 Systems, IDunion SCE, MOSIP, Open Identity Exchange, Secure Identity Alliance, The Digital Dollar Project, Universitat Rovira i Virgili and the Trust Over IP Foundation.
There are a couple of notable member omissions from today’s official launch — back in September Okta and CVS Health were name-checked as probable founding members, but it appears that they won’t be joining after all. TechCrunch has reached out to all parties for comment, but we have yet to hear back at the time of publishing.
The OWF is the latest in a line of similar initiatives birthed by the Linux Foundation to bring interoperability to various industries. Back in December, it partnered with Meta, Microsoft, AWS and TomTom to counter Google’s mapping dominance via the Overture Maps Foundation. And Linux Foundation Europe also recently launched Project Sylva in conjunction with Telefónica, Orange, Vodafone, Deutsche Telekom, Telecom Italia, Ericsson and Nokia, with a view toward building an interoperable, open source cloud framework for European telcos and vendors.