A Service Provider Recommendation System for Verifiable Credential Ecosystem

Verifiable Credentials (VCs) underpin decentralized identity ecosystems across domains such as banking, healthcare, and mobility. In these ecosystems, organizations that verify user attributes to grant access to services, known as Service Providers (SPs), rely on proofs derived from user credentials. Achieving privacy across multiple SPs with diverse data requirements, however, remains challenging. Privacy sensitivity varies by domain, regulation, and user preference, while overlapping attribute requests and representation choices increase disclosure risk. This paper presents the Service Provider Recommendation (SPR) system, which assists users in selecting privacy preserving combinations of SPs and credentials. SPR quantifies privacy risk based on attribute sensitivity, representation granularity such as "age over 21" versus "date of birth", and credential assurance levels, and recommends minimal risk disclosures through adaptive negotiation. A prototype implementation was evaluated on a loan application use case, demonstrated measurable privacy risk reduction and improved user control. The results validate the feasibility of SPR for privacy-aware service provider credential sharing within decentralized identity ecosystems.