E-residency may imply a values-based connection to the Estonian state

The reasons for joining may be economic, but also, for example, an interest in the Estonian countryside and culture and the digital solutions Estonia offers.
The reasons for joining may be economic, but also, for example, an interest in the Estonian countryside and culture and the digital solutions Estonia offers.

E-residency allows foreigners, regardless of their citizenship, place of residence and nationality to apply for a digital ID and to access Estonian public and private e-services. Estonian social scientists interviewed e-residents around the world and showed that, although Estonian e-residency is primarily a service platform, being an e-resident also implies for many a sense of a transnational and values-based belonging to the Estonian state.

"How an e-resident thinks about his or her relationship with the Estonian state, or how this relationship might transform in the future, is individual," says Piia Tammpuu, who participated in a research project led by Tallinn University of Technology (TalTech). While some e-residents perceive the e-state digital platform like any other market-driven platform, where what matters most is the ease of access to services, there are others who think more broadly about this relationship and are also interested in the values and principles that ground e-residency.

Anu Masso, an associate professor of big data in social sciences at TalTech's Ragnar Nurkse Department of Innovation and Governance, along with two of her PhD students, Mergime Ibrahim and Tam Abaku, have studied the relationship of e-residents with the Estonian state. They conducted in-depth interviews with 25 e-residents, asking them about their motivations to apply for the e-residency program, personal experiences with being an e-resident, their assessments of the advantages and disadvantages of the system, and how they see their e-resident status.

E-Estonia as a 'home club'

As e-residents communicate with the Estonian state through a special digital service platform, the researchers based their work on the concept of platformization. "Simply put, platformization can be understood as an increase in the impact (power) of digital platforms," ​​said Piia Tammpuu. In other words, the infrastructure of digital platforms, their data-driven business models, governance frameworks and operating logistics are increasingly affecting different sectors of the economy and spheres of life.

Tammpuu said, e-residency is a digital platform designed by the Estonian state that connects service providers with e-residents as users of these services. "Therefore, we were interested in how the concept of platformization might be perceived and thought about, i.e., how e-residents understand this digital service 'platform' and by that their connection with the Estonian state as the creator and owner of this platform," she said.

Anu Masso said, they have assumed that the ideological preconditions for the operation of the platform and its societal implications could be best understood by talking to the e-residents themselves, so they have analyzed the stories, opinions and attitudes that emerged from the interviews.

"The results of our surveys, as well as the statistics on applications, have shown that the connection of those interested in the e-residency program with Estonia has changed somewhat over time," said Masso. While in the early years, people from Finland and other neighboring countries who were already connected to Estonia aspired to become e-residents, nowadays e-residents come from much further afield.

Masso said that the results show the e-residency offers not only a relationship based on economic transactions and services, but also a sense of being connected to Estonia. "One of the important conclusions of the article is that e-residency provides a basis for a transnational and cross-border sense of belonging," she pointed out.

Tammpuu said the results have shown that those who have joined the e-residency program did not see it as a purely pragmatic relationship between the consumer and the service provider. In some cases, they felt a broader connection with the Estonian state. "This can be, for example, the appreciation of the openness, democracy and innovation of society, as well as the interest in Estonian culture and the land," Tammpuu summarized.

Masso said that based on the interviews they had conducted, they have defined the e-residency as a platform-based relationship between the state and the individual. The associate professor said that none of them see the e-residency platform as a service provider based in Estonia, but as a member organization.

Such an organization establishes its own rules of inclusion and exclusion: "In other words, e-residency is not only perceived as an economic product, but also as an active process, an active agent, which shapes people's relationship with the state," said Masso.

Those for whom e-residency represents a sense of belonging, feel emotionally connected to Estonia as a digital country. "In addition to transaction-based engagement, there is also value-based perceived digital membership, which can be the basis for a collective sense of transnational belonging," she said of the two main types of affiliation identified in the study.

Interests vary as does usage

Based on the interviews, both Piia Tammpuu and Anu Masso indicated that the motivations of the respondents to join e-residency vary. According to Masso, the reasons for joining may be mainly economic, but also, for example, an interest in the Estonian countryside and culture and the digital solutions Estonia offers. "In general, it can be said that while some apply for an e-resident's digital identity with a specific purpose in mind, others - for a wider interest or curiosity," said Tammpuu.

Based on the statistics on applications for e-residency, she pointed out, it is clear that over time there were more and more practical reasons for applying for e-residency. Here you can see the impact of greater awareness in Tammpuu and more targeted marketing communication of the program. This is where Tammpuu sees the impact of increased awareness from targeted marketing communication of the program.

At the same time, not all Estonian e-residents around the world may use and benefit from the platform in the same way, that is because their access to various digital services, such as banking and financial services, is different. Tammpuu said that e-residents from so-called third countries may be dealing with different concerns. "Interviews with e-residents from Africa, for example, showed that geographical location, which seems to be irrelevant to e-residency, is still a factor for some e-residents that limit their opportunities," she said.

The interviews also showed that e-residents from different countries perceive some discrimination and different treatment depending on their country of residence or origin and/or nationality. Tammpuu said, they notice this in e-residency marketing communication, information activities, as well as in the processing of applications. "Perhaps the idea of ​​the separation between the virtual and physical worlds offered by e-residency is in many ways illusory," she said.

If the e-residency team wants to further develop the program based on the experience of its participants and the social science perspective, Masso recommended to focus on the two grounds of belonging that emerged from the study: economic services-based and values-based. "These are two somewhat different dimensions that express the relationship between the individual and the state from the perspective of e-residency as a platform," she said.

In the future, Tammpuu said, it is important to think about the global effects of e-residency in a broader perspective. "From the perspective of social sciences, it is also worth emphasizing the opportunities that e-residency offers especially for citizens of countries with fewer digital opportunities," she said. This issue is discussed in detail, for example, in an article focusing on African e-residents previously published by Anu Masso's working group.

E-residency team: E-residents make Estonia bigger

Estonia was the first country to launch an e-residency program at the end of 2014. In the seven-and-a-half years since, Estonia has attracted more than 92,000 e-residents. "This year, this number is expected to grow to six digits—it can be said that the community of e-residents will soon be the second largest city in Estonia," said Liina Suvi Ristoja, a spokeswoman for the e-residency team.

She added that Estonian e-residents form a 'diaspora' that now extends to 179 countries around the world, i.e., in their own way, e-residents make Estonia bigger, said Ristoja. Their relationship with Estonia depends on different circumstances and each resident's way of life. Overall, however, Ristoja said that ​​the relationship of e-residents with Estonia is much stronger than the creators of the program dared hope.

"We see many e-residents who are real fans of Estonian and Estonian culture," she said: "Many of them will be living here for at least some time - there are many so-called digital nomads among them, who can work as freelancers and regardless of their location."

Ristoja said, e-residents communicate a lot with each other and with the program team: "Estonia has become a utopia destination for digital enthusiasts, and e-residency is its business card."

According to her, many e-residents see this as a mainly affordable and easy way to do business.

"At the same time, there are others for whom the e-resident's digiID is like a proof of belonging to a special club; this we see and experience face-to-face at e-residents' meetings," she said.

As setting up a business in many EU countries is complicated and expensive, e-residents highly value the simple and understandable business environment offered by Estonia. "In any case, e-residents are keen to maintain a thriving entrepreneurial space in Estonia, and so it is fair to say that they care about the future of the country," she said.

A study by Masso and Tammpuu revealed that e-residents of African origin, for example, do not feel equally treated. Ristoja then noted that e-residency is not a human right, but a benefit offered by Estonia. "The aim of the program is primarily to benefit the Estonian people and at the same time ensure that the program operates securely," she said.

Ristoja said that while a lot of interest could have been expected from entrepreneurs in developing countries, about half of the applicants for e-residency are citizens of the EU. Interest in e-residency is particularly high in Germany, and the program focuses on the U.K. and Spain. "When we talk about equal opportunities in the use of digital public services, the truth is that in this regard Estonia is ahead of also most Western countries, and we offer Europeans more than their own countries," said Ristoja.

In the future, the team hopes to further intensify their interaction with e-residents, i.e., get to know their needs better, improve the user experience and integrate them with Estonia for a longer period of time. As the coronavirus pandemic adds more and more freelancers working across borders, the team is continuously thinking about growth. There are now five to ten million digital nomads in the world.

"Continuous expansion is the key here, because, following the example of Estonia, other countries have also started to develop their e-residency programs, and so if Estonia wants to be at the forefront of digital services, it must already think about competition," said Ristoja.

E-Residency currently has digiID pickup location in 48 countries around the world: the latest in Johannesburg, Singapore, Sao Paulo and Bangkok. Ristoja said, e-residency plans to establish up to 15 new pickup locations over the next few years.


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Editor: Kristina Kersa

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