The Schengen Visa Application of the (near) Future

In the second of three blog posts on developments in the visa application outsourcing industry, we examine how the new single EU Visa Application Portal and digital visas will revolutionise the Schengen visa application process in the near future and beyond

The 29 Schengen States are one of the single largest visa-issuing blocs in the world, with more than 11.7 million Schengen visa applications made globally in 2024. While the process and requirements for applying for a Schengen visa are ostensibly the same everywhere, governed as they are by the Schengen Visa Code, individual member states can operate very differently in practice due to a combination of legacy technology, political desires and operating models. 

However, with the introduction of the single European Union Visa Application Portal (EU VAP) under the New Pact on Migration and Asylum, currently slated for 2028, those differences could become significantly narrower.

And unlike the last major change to the Schengen visa application process in 2011, when biometric enrolment was introduced alongside the Visa Information System, the new EU VAP should make applying for a Schengen visa significantly easier and less expensive for applicants. 

But what about the global visa application outsourcing industry? 

Will it also benefit from the change?

Digitising the Schengen Visa Process

Back in 2020, the European Commission commissioned Deloitte to look at digitising the Schengen visa process. Deloitte published a report - “A Study on the Feasibility and Implications of Options to Digitalise Visa Processing” - that proposed several options, with the preferred being a single visa application portal (the ‘EU VAP’, as it’s now known) and digital visas (or ‘e-visas’).

The EU VAP would replace the current hodgepodge of Schengen and national visa application systems, which range from online forms provided by national governments (e.g., France, Germany) to digital forms provided by visa application outsourcing companies, as well as the use of paper-based forms (yes, that’s still an option!)

The proposed idea - and the one now outlined in the snappily-titled “Regulation (EU) 2023/2667 of the European Parliament and of the Council of 22 November 2023 amending Regulations (EC) No 767/2008, (EC) No 810/2009 and (EU) 2017/2226 of the European Parliament and of the Council, Council Regulations (EC) No 693/2003 and (EC) No 694/2003 and Convention implementing the Schengen Agreement, as regards the digitalisation of the visa procedure” - is that a single visa application portal will be used for all Schengen visa applications, as well as potentially being a conduit for submitting Type D national visa applications for a ‘long stay’ of more than 90 days. 

Visa applicants will simply navigate to the EU VAP, answer a few questions about their intended travel, personal circumstances and current location, and the EU VAP will recommend where to apply for a visa and which supporting documents to provide.

As the Schengen visa application process is unified in the EU VAP, in theory, this should eliminate situations in which some Schengen States choose not to implement the rules on re-enrolling biometric data and require visa applicants to do so every time they apply. Therefore, as a visa applicant, you’ll only be required to re-enrol your fingerprints if:

• It’s your first time applying for a Schengen visa;

• You’ve changed your passport since the last time you enrolled your biometric data;

• It’s been more than 59 months since you last enrolled your biometric data; or

• You’re applying for a National visa.

In research conducted by Souter Point, we estimate that new visa applicants account for 50% of Schengen visa applications, although there are wide differences across source markets. With the average adult passport being valid for 10 years, it means that the number of Schengen visa applicants having to visit a visa application centre to enrol their biometric data could be as low as 50-60% of the current number of visa applicants, which has profound implications for both visa applicants and visa application outsourcers.

Cost Savings All Around (well, almost)

In their report, Deloitte estimated that the EU VAP would save each visa applicant EUR 55 by digitising the Schengen visa application process and, in many cases, eliminating the need for applicants to visit a visa application centre (VAC). The use of digital visas, meanwhile, would also save those applicants who typically used a courier return added value service an additional EUR 15 to EUR 17. 

On the government side, the EU VAP and digital visas would save a combined 1,262 full-time equivalent (FTE) employees, with an additional EUR 10 million per year saved from digital visas, as Schengen States would not have to securely produce, ship, and store physical visa vignettes. 

The cost of the EU VAP was estimated at between EUR 75 million and EUR 145 million over eight years, while the digital visa system was estimated at between EUR 3 million and EUR 6 million. Costing between EUR 2.7m and EUR 5.2m in the first year, and several hundred thousand euros per year thereafter for maintenance, the cost of the EU VAP and digital visa system for each Schengen State would be minimal given the benefits it provides.

However, on the visa application outsourcer’s side, while there will be cost savings from lower technology requirements (no complicated business rules engines to determine supporting documentation requirements) and smaller VACs needed to accommodate lower footfall, revenues will decline as service fees and high-price, high-margin added value services linked to appointments and passports are significantly reduced - or eliminated altogether.

Visa Application Outsourcing Impacts

Visa application outsourcers will be affected by both lower footfall at VACs, which reduces core service fee revenues, and the reduction in demand for, or complete elimination of, high-margin added-value services. Additional quality-control burdens are also possible, without a corresponding direct link to offsetting revenue, if visa application outsourcers are expected to review applications uploaded to the EU VAP before a government caseworker looks at them. However, there will also be scope for new added value services, counterbalancing some of these adverse effects.

Revenue Impacts

A special report published by Souter Point, Digitising the Schengen Visa Application Process, found that the combination of the EU VAP and digital visas will reduce VAC operator revenues by 52-53%, with core service fees falling by 50% and AVS revenues by 54-55%. In a median-price scenario, with a hypothetical visa application centre receiving 100k annual applications under a traditional operating model, the new operating model will result in revenues falling by EUR 3.0 million, from EUR 5.7 million to EUR 2.7 million.

Lower footfall at the VAC, resulting from a stricter application of biometric enrolment requirements aligned to the requirements of the Schengen Visa Code, will affect the visa application centre's core service fee revenue, as visa applicants now apply 100% online through the EU VAP and receive a digital visa via email. There is therefore no need for them to visit a visa application centre, unless they wish to use an added value service.

With the EU VAP and reduced footfall at the VAC, any appointment-based added value service, such as premium lounge access and prime time appointments outside of regular working hours, will likely decrease in proportion to the number of visitors to the VAC, roughly halving.

Meanwhile, any added value services linked to the logistics of shipping a physical passport between the applicant, the visa application centre, and the Schengen State will be eliminated, including high-margin courier return services and other passport-related services, such as retaining your passport until a visa decision has been made. There will be cost savings from eliminating passport logistics, but the drop in added value service revenue will be much higher.

Furthermore, due to reduced footfall at the VAC, the opportunity to upsell other added value services will also be eliminated as there is no in-person upsell opportunity.

Opportunities for New Added Value Services

What will counterbalance some of these revenue drops is the opportunity for visa application outsourcers to offer new added value services, such as supporting applicants in navigating the EU VAP remotely. 

There is also still likely to be demand for an in-person, full-service option, where visa applicants visit a VAC with all their supporting documents and a member of staff completes the online application on their behalf, including scanning and uploading all supporting documents and facilitating an online payment for the Schengen visa fee. However, it is unlikely that these new added value services will be able to offset anywhere near the revenue losses from lower footfall and the elimination of passport-related added value services.

What Happens to Quality Control?

A further downside is that visa application outsourcers are likely to be required to quality control all Schengen visa applications submitted through the EU VAP - even if the application did not pass through their own office. Article 35 of EU Regulation 2023/2667 states that visa application outsourcers: 

“...should have access to the EU VAP only to retrieve and review applications; verify data temporarily stored, for example a scan of a travel document; check and upload relevant personal data from the chip of the travel document; collect and upload biometric identifiers; perform quality checks on the uploaded supporting documents; confirm that an application has been reviewed and thus make it available to the consulate for further processing.” 

This indicates that Schengen States can require visa application outsourcers to check the quality of Schengen visa applications through a special account, which is only issued to official visa application outsourcing contract holders. 

Additionally, visa application outsourcers may be responsible for reviewing all Schengen visa applications, not just those processed in their own offices. The cost of performing this activity will therefore need to be included somewhere, either embedded in the service fee the visa application outsourcer charges to those Schengen visa applicants that use its service or as a separate (potentially lower) service fee for online-only applicants, as there is no provision in the Schengen Visa Code for national governments to pay for such services.

Will Competition Heat Up?

Visa application outsourcers hold exclusive contracts directly with national governments to provide visa application services. They are the only external, private organisations permitted to enrol visa applicant biometric data and are also usually the only organisations allowed to transfer passports to and from consulates. But, in a world where we have the EU VAP and digital visas, will their competitive positioning also take a hit?

Procurement Practices Stifle Outside Competition

Firstly, unless national governments change the way they procure visa application outsourcing services, the core biometric enrolment service will continue to be performed by experienced visa application outsourcing companies. VFS Global, TLScontact, BLS International, Capago, and similar firms will continue to be the only types of organisations that can comply with procurement rules, which often stifle competition from outside.

National governments frequently stack the deck against new entrants to the visa application outsourcing industry by requiring x number of years of experience running a (Schengen) VAC, experience operating at least one VAC in y number of countries, or the provision of signed references directly from national governments confirming the scope of such services. As these requirements are red-line, knockout criteria, any organisation that cannot meet them will be eliminated from the procurement process.

Therefore, for the core biometric enrolment service, incumbent visa application outsourcers will continue to compete among themselves.

Visa Agency Competition

But for services such as a new digitally delivered Schengen visa application support service or an in-person support service that scans and uploads supporting documents, visa application outsourcers are likely to face heightened competition from unofficial visa agencies.

As visa applicants will be able to use any visa agency with an internet connection to support them through the EU VAP application process, this will heighten competition for this type of added value service. 

Furthermore, visa applicants will not necessarily need to use a visa agency in the country where they are applying for a Schengen visa, as it will be entirely possible for a Philippines-based travel agency to assist a US-based Filipino national in applying for an Italian Schengen visa.

Visa agencies can also offer the same in-person, full-service experience, welcoming visa applicants in their office, scanning their supporting documents, completing all the visa application forms, and uploading everything to the EU VAP.

Therefore, there will be heightened competition from such visa agencies, further eroding official visa application outsourcer revenues.

The Final Nail in the Coffin?

While the Schengen States focus on digitising their borders with the Entry/Exit System and launching the EU VAP and digital visas, the preliminary work being done by the UK Government on remote fingerprint enrolment is likely to be at the back of their minds. 

Remote Biometric Enrolment

Passports and facial images can already be enrolled remotely using a smartphone without the need to visit a visa application centre. And if the pilot programme by the UK Government in early 2026 - Biometric Remote Enrolment Technology, or BRET - is successful, it may soon be possible to also remotely enrol fingerprints to a degree of confidence that satisfies national governments.

Should a BRET-type system be deployed by the Schengen States in the future, there would be very little need for a visa application centre network. Visa applications will be made 100% digitally through the EU VAP, a mobile app will be used to enrol biometric data (including fingerprints), and a digital visa will be issued via email. Only where national governments wish to provide visa applicants with an alternative in-person Schengen visa application route will VACs be needed. Such an evolution would be the final nail in the coffin for the visa application outsourcing industry if the UK and Schengen States were to discontinue their global VAC networks, even if the Schengen States typically take 5-10 years to adopt new industry working practices.

The Future of the Schengen Visa Application Process

The EU VAP and digital visas will be a step change for Schengen visa applicants and visa application outsourcers. It's clear that the potential benefits to the visa applicant vastly outweigh those for the visa processing industry, and that the Schengen States themselves are likely to come out ahead, too. 

If the rules on re-enrolling biometric data are uniformly applied at the Schengen level through the EU VAP, Schengen visa applicants will only need to visit a visa application centre once every few years, saving them significant time and money. 

The introduction of digital visas will also make applying for a Schengen visa more convenient, as applicants will no longer need to be without their passport during the visa application process. 

And if remote biometric enrolment is introduced in the future, visa applicants may never need to visit a visa application centre at all.

Visa application outsourcers, on the other hand, face several challenges due to the introduction of the EU VAP and digital visas. 

Footfall at VACs will likely plummet - in many cases by half - reducing the addressable market for high-revenue, high-margin appointment-based added value services, as well as core service fees. Digital visas, meanwhile, will eliminate any passport-related added value service, further reducing incomes. 

The EU VAP could also increase competition for any new added value services, such as remote Schengen visa application support, as an unofficial visa agency could provide this service from any location. 

And in the extreme potential future scenario of the European Commission giving remote biometric enrolment its blessing, the need for VACs will be virtually eliminated, except where national governments wish to retain a physical presence.

Due to the legal and political constraints under which the Schengen States must operate, any such drastic change will be some distance away. The EU VAP and digital visas will be phased in over seven years from 2028, and given the usual lag between where the visa application outsourcing industry leads and the adoption of new working practices by the Schengen States, it could be a decade or more before the Schengen visa application process becomes 100% remote and digital.

That is not to say that visa application outsourcers can sit back. They must adapt to the impending introduction of the EU VAP and digital visas, and scale up remotely provided support services, as well as identify new ways to add value to the visa application process. Otherwise, the value of a typical official Schengen visa outsourcing contract will drop by more than half.

Souter Point provides consulting services to governments and private-sector businesses in the visa and immigration space, including strategic advice, research, and sales support, such as bid management and new market-entry strategy development. We also work with management consultancies, institutional investors and other interested parties to help them gain a clear understanding of how the global visas and immigration industry operates. If you’d like to learn more about what’s happening in the visa and immigration space and where it might lead, please send us an email at gri@souterpoint.com, and we can schedule a call to discuss your needs.