Why Estonia offers e-Residency

The idea

Over the last 20 years, Estonia has made 99% of its government services available online, accessible by citizens and residents through secure, government-issued digital identities. This means almost any interaction with the state - such as voting, filing tax returns and registering a birth - can be done entirely online from virtually anywhere in the world. In addition, these same digital identities can be used to access an increasing number of private sector services such as online banking.

Estonia’s digital infrastructure has continued to develop, like a startup refining its services, yet the number of users who could benefit was always limited to the number of citizens and residents of the country. If the number of users could also be scaled up, like a startup, then it was theorised that all users would benefit from the improvements brought about by this economy of scale and the startup would also return larger benefits to its shareholders – the people of Estonia.

The birth of e-Residency

In 2014, Estonia decided to provide digital identities, along with access to Estonia’s digital services, to citizens of other countries who do not have residency in Estonia. These people were called e-residents and received e-Residency digital ID cards, offering access to many of same government e-services previously only available to Estonians living in Estonia.

By taking this step, the Estonian government turned citizens of countries all over the world into potential ‘users’ of Estonia’s services. The next step was to consider which Estonian services were most valuable and relevant to these e-residents, as well as how use by e-residents could bring value to Estonia.

e-Residency today

As of today, 80,000 foreign nationals from 170+ countries have become e-residents, the main benefit being the ability to establish and manage a location-independent company in Estonia entirely online. 

The e-Residency programme has already proven beneficial on a modest scale for citizens, residents, e-residents and Estonia as a nation. The programme has paid for itself by bringing more direct income to the Estonian state, invested by Estonian taxpayers. E-Residency has also helped people around the world access entrepreneurship and conduct business globally in ways not previously possible and, in doing so, has provided more business, jobs and investment for companies in Estonia.

In December 2018, the programme entered the second phase of its development with the launch of the e-Residency 2.0 white paper with President Kersti Kaljulaid. The goal of this initiative is to make this already successful programme more convenient, beneficial and secure for both Estonia and the growing e-Residency community.

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