What Is an Identity Provider (IdP)? Definition, Examples, and Use Cases

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An Identity Provider (IdP) is a service that stores and manages digital identities for humans or software entities. You can think of an IdP like a social register from Regency-era England, where details about individuals—such as names, titles, and familial connections—determined who could attend events or verify a person’s identity.

Modern IdPs won’t get you into fancy parties, but they do ensure that access to digital services is granted only to the right users.

What Do We Mean by Identity?

A digital identity is a mapping of information about an individual or entity to that entity itself. This includes things like:

• Username
• Email address
• Physical or billing address

A subset of this information is unique and verifiable, forming the user’s identity factors. These factors fall into three categories:

1. Knowledge: Something the user knows (e.g., password, PIN, security question)
2. Possession: Something the user has (e.g., smartphone, security token)
3. Inheritance: Something the user is (e.g., biometrics, fingerprints, facial recognition)

These factors are used to validate and authenticate the identity of the user or entity.

Why Are IdPs Important?

IdPs are crucial because they allow secure access to resources while ensuring that only authorized users can reach them.

While service providers (SPs) can manage identities themselves, this often adds complexity. IdPs specialize in:

• Storing identities securely
• Managing authentication flows like Single Sign-On (SSO) and Multi-Factor Authentication (MFA)

This specialization reduces the burden on SPs while improving security for end users.

How Do IdPs Work?

IdPs let users log in to multiple service providers with a single set of credentials. A typical interaction looks like this:

1. The user requests access to a service provider (SP).
2. The SP redirects the user to the IdP for authentication.
3. The user provides credentials (passwords, biometrics, or other authentication methods).
4. The IdP validates the user and reports back to the SP.
5. Access is granted or denied based on the IdP’s response.

IdPs also let administrators define access policies based on roles, resource types, or other attributes, giving fine-grained control over who can access what.

Types of Identity Providers

IdPs come in different forms depending on their use case:

1. Social IdPs – Simplify login using existing accounts like Facebook or Google, reducing password fatigue and improving user experience.
2. Enterprise IdPs – Enable employees to access multiple company apps with one set of credentials (SSO). Examples include Okta or Microsoft Azure AD.
3. Legal / Government IdPs – Managed by governments for official digital identities (e.g., Criipto for eIDs in Denmark, Norway, and Sweden).

Benefits of Using an IdP

Using an IdP offers numerous advantages for both users and service providers:

• Simpler Credential Management: SSO or social logins reduce password reuse and simplify authentication.
• Automated Onboarding/Offboarding: Grant or revoke access efficiently based on roles or group membership.
• Focus on Core Offerings: SPs can delegate identity management to experts and concentrate on their primary services.
• Enhanced Security: IdPs specialize in identity protection, following industry standards.
• Audit and Compliance Tracking: Centralized identity management enables monitoring of who accessed what and when.
• Flexible Authentication: Support for multiple authentication methods ensures user convenience and security.
• Service Agnostic: Users and organizations can reuse identities across multiple services, streamlining access management.