It is widely used to identify individuals and organisations in Iceland.
After 1980, number shortages led to the reuse of deceased persons' names, causing occasional problems in the health and education system.
For a personal ID number, the first six of these are the individual's date of birth in the format DDMMYY.
[1] The identification numbers assigned to companies (and other legal entities) can be distinguished by the fact that the DD component is always greater than that for individuals.
This is attributed to the addition of the number 40, resulting in the initial digit being 4, 5, 6, or 7.
The seventh and eighth digits are randomly chosen when the ID number is allocated, ranging from 20 to 99 (with some exceptions).
The ninth is a check digit, and the tenth indicates the century of the individual's birth: '9' for 1900–1999, '0' for 2000–2099.
D = day, M = month, Y = year, R = random, P = parity, C = century.
The consequence of this design is that at most 80 people can be born on the same day.
The system is similar to that employed by some other European countries, but Iceland makes unusually extensive and public use of its ID numbers, with businesses, educational and medical institutions eschewing internal identification numbers in favour of the national system, and its use being mandated in banking transactions.
The completeness of the National Register has eliminated the need for the country to conduct a regular census: population statistics can be obtained by simply querying the database.
Institutions and companies alike use the eID, tied to an ID number, to login and authenticate users, by use of a mobile app.
This can be a hindrance to newly settled residents, as it takes some time to apply and be issued a new ID number.