Estonia will become the first country in the world to offer “e-residency” for people interested in using state digital services such as banking and registering a company.

With 80 votes in favor, the 101-member Estonian Parliament on Tuesday passed a law that will allow issuing of electronic identification cards to foreigners living abroad, starting at the end of this year. For €50 ($64), applicants can obtain a digital ID that will let them sign documents online and essentially have a digital life in Estonia, including running a domestic business without physically being there.

Estonia hopes the move will cement its reputation as a world tech leader. The country already has pioneered online voting in general elections and is home to tech innovators such as video-chat provider Skype and peer-to-peer money-transfer facilitator Transferwise.

The digital signatures will come with a state-sanctioned guarantee that the user is who he or she claims to be, said Taavi Kotka, deputy secretary-general for communication and state information systems at the Ministry for Economic Affairs and Communications.

“The Estonian state is going to offer a strong digital identity for foreigners,” Mr. Kotka said. “The card is an opportunity for people whose country of residence does not offer them a strong digital identity to come and get it from Estonia.”