As a core element of online interactions, our digital identities are at the heart of our lives — both at work and at home. A complex ecosystem of components and protocols is responsible for creating, managing, and using these digital identities — and a critical part of this ecosystem is the identity provider, or IdP.

In 2025, identity providers have become foundational in how businesses and governments secure access to digital services, especially as workforces grow increasingly distributed and SaaS stacks multiply.

What is an IdP?

An IdP is a third-party service that issues and manages digital identities. Here’s how it works: A user identity is registered with an IdP. The registration process may involve the collection of personal data, like the user’s name and address. The IdP captures and associates login credentials, including multi-factor authentication (MFA) elements, with the user's identity account. An IdP is part of an identity and access management (IAM) system.

After registration, an IdP can authenticate a user identity at the request of a service provider (SP). At a baseline, an IdP will authenticate a user's login credentials against its database before allowing login. An IdP can act as a centralized service that authenticates people to apps and other services.

Modern IdPs are often cloud-based and delivered as identity-as-a-service (IDaaS). They enable single sign-on (SSO), enforce security policies, and reduce the operational overhead of managing user accounts.

To ensure data security, IdPs never store credentials in plaintext. They follow encryption and hashing standards, such as bcrypt or Argon2, in accordance with NIST SP 800-63.

What is an IdP used for?

IdPs are used to verify any kind of identity—human or otherwise.

• Enterprise workers: IdPs are used within an organization to manage the identities of employees and relevant non-employees such as contractors and suppliers. An example of an enterprise IdP is Microsoft Entra ID (formerly Azure Active Directory). 

• Consumers: IdPs managing consumer user accounts include social login services like Google. You can extend consumer and social identity providers by integrating them with consumer identity and access management (CIAM) services.

• Citizens: Governments often make use of dedicated IdPs. Non-government and commercial vendors may provide these IdPs. An example of a government IdP is CitizenSafe from GBGroup. Citizen IdPs are often integrated with external verification services to check consumer data.

• Devices and computers: IdP management of identities can extend to non-human objects like IoT devices. ForgeRock provides an IdP for IoT devices.

IdPs enable secure and scalable identity management across this wide range of users and use cases.

Some well-known IdPs

Here are some of the most common identity providers today:

• Google

• Apple

• Microsoft Entra ID

• LinkedIn

• GitHub

• Okta

These IdPs are widely integrated with both enterprise and consumer apps.

Benefits of an IDP

Five of the most beneficial uses of an IdP are:

1. User management and registration

An IdP manages your workforce or customers, reducing the need for custom logins. Registration can be automated, and self-service can be built into an IdP, reducing the need for help desks and laborious manual account resets.

2. Password fatigue reduction

An IdP helps to rescue the number of login passwords that employees need. If used with SSO (single sign-on), this number is reduced further, and login across multiple apps is streamlined.

3. Audit and accountability

An IdP keeps track of user logins. This can be a vital tool in managing employees' app use and making insightful decisions about app and data usage and privileges. Centralized account auditability can also help identify insider threats.

4. Control

An IdP can be thought of as a single source of truth, managing and controlling employee (and customer) identities and user authentication.

5. Identity management efficiency

An IdP is a more efficient way to centrally manage your employees or customers. Account management can be performed quickly, and onboarding and offboarding can be managed more effectively.

IdP protocols

Identity protocols SAML (Security Assertion Markup Language) and OIDC (OpenID Connect) are the underlying protocols of most IdPs.

SAML IdP

SAML (Security Assertion Markup Language) is an XML-based identity protocol used primarily for SSO. A SAML IdP sends digitally signed assertions to service providers, allowing access without password exchange. SAML remains widely used in enterprise environments, particularly for legacy web apps.

OIDC IdP

OpenID Connect (OIDC) is a modern, lightweight protocol built on top of OAuth 2.0. It uses JSON Web Tokens (JWTs) to transmit identity claims in a secure and scalable format.

OIDC is easier to implement for mobile apps and SPAs and supports consent, scopes, and modern token handling. Key differences:

1. SAML is more complex to implement.

2. OIDC uses JWTs, which are smaller and have lighter-weight processing requirements than the XML documents that SAML uses.

3. OIDC integrates user consent by default. This can also be achieved using SAML, but it is more complex to set up.

In 2025, OIDC is the default for new applications due to its ease of integration and better mobile and API support ([Auth0 IAM Trends](https://auth0.com/resources/reports)).

IdP workflow steps

User registers with the IdP: The user must provide unique information, such as an email address. The registration process will capture login credentials based on the security requirements of the IdP service. 

Post-registration: Once the user has registered, the IdP issues an identity, and the user (typically) has access to their account and personal data.

This digital identity can then be used with an SP that is federated with the IdP.

The IDP workflow has three core steps:

1. Authentication: The user is requested to present their identifying credentials, such as a username and password or MFA.

2. Verification: The IdP checks these credentials to see whether a user has access to the service.

3. Authorization: Users are given access to resources based on their authorization level.

Additional: Choosing an IdP in 2025

When evaluating IdPs today, consider:

• Protocol support: Choose IdPs that support OIDC and SAML to ensure broad compatibility

• Provisioning: Look for SCIM or HRIS-based provisioning workflows, or use tools like AccessOwl to automate lifecycle actions

• Shadow IT coverage: A good IdP should integrate with discovery tools to bring unsanctioned apps into governance

• Audit readiness: Look for built-in reporting, log retention, and access review capabilities

The best IdPs in 2025 combine open standards, automation, and visibility to support both security and scale.

Identity providers are no longer optional infrastructure, they’re central to modern IAM strategies. Whether you're a startup using Google Workspace or an enterprise with hybrid cloud, an IdP gives you the foundation to manage access, enforce policy, and meet compliance goals.

Pairing your IdP with a governance layer like AccessOwl ensures that identities stay clean, secure, and auditable across your entire SaaS stack.