Islanders will be able to use their phones as identification from May.
Jersey residents will be able to verify their identity and their age by using digital services provider, Yoti.
Deputy Scott Wickenden says the new system will also enable islanders to access their health records.
Deputy Wickenden also says the digital ID service would help prevent under-age drinking.
The States say they selected Yoti as the provider because of its security protocols.
Yoti uses a hybrid encryption system to secure personal details, which means they cannot access customers' personal data, nor share it with different organisations.